Like it or not, every boardroom is going through a huge transition – especially around transparency, composition and digitalisation. There’s a larger emphasis on better boardroom behaviour and this is creating higher levels of scrutiny from the outside. This transition is influencing boards, and as a result, they are beginning to lift the lid on the often quasi-hidden world of governance.
While the role of a director is growing more complicated (as discussed with CEO of Diligent, Brian Stafford in this podcast), there is, luckily, a way to better navigate these changes. Of course, we’re talking about future-proofing your board of directors. This is key in preparing and protecting your board.
And the best part? You don’t need a crystal ball to do it.
You’ve heard the saying “The fish rots from the head”, right? Well, like Bob Garratt, author of the similarly-titled book The Fish Rots From The Head: Developing Effective Board Directors says, organisations are similar in that they can rot from the boardroom down. Future-proofing is a direct way to combat that.
But if future-proofing is new to you, here are 7 steps your board needs to know.
#1 The Big Picture
Get clear on the purpose of the board, especially in the new economy and a tech-enabled world. As the organisation or company evolves, what is your board doing to anticipate, adapt and evolve? Any organisational changes will likely affect the board’s purpose, so now is the time to question that.
#2 Review and Identify
Once you’ve (re)clarified the board’s purpose, take a look at the skills and competency gaps in its structures. This is the time to double-check that you’ve got the right people, with the right skills, in the right positions, within the right structures. Remember, be open to changing things up. When you review and identify gaps, use an open mind when you fill them.
#3 Drill down on Shared Values
Going into a relatively uncertain future means you’ll need a board of directors that – while potentially from different backgrounds, cultures and experiences – have the same shared values, vision and commitment. Future-proof the board by ensuring you’re recruiting people who not only fit the skills you need, but fit the board’s values. Diversity is a beautiful thing, but not when it comes to (not having) shared values.
#4 Broaden Your Horizons
When recruiting, look beyond the existing networks, C-Suite or ‘experienced’ directors. Give outsiders a chance to prove their worth. This goes against tradition, but it’s increasingly more common for smart organisations to bring in specialist outsiders who are skilled, but not already non-executive directors. If you are an outsider, you might be interested in my book, Right Seat Right Table: An Outsider’s Guide to Securing the Ideal Board Role.
#5 Ongoing Training and Evaluation
Invest in contemporary training and regular evaluation of your board members. But don’t make the mistake of thinking training needs to be just technical governance or regulatory related. Training also must include customer-centric design, human capital, boardroom technology, digital marketing, emotional intelligence and change management.
Companies are needing to deal with everything strategically, and incorporating all these aspects will future-proof the board on a holistic level.
#6 Adopt Board Software
It’s time to bring tech into the boardroom. There’s no way around it. But this is a good thing! There is such a large amount of software that aims to help with everything from the basics, like organising meetings and coordinating board papers, to the complex, like governance management cloud software such as Diligent, or Bondle, first-of-its-kind subscription-based software. The integration of technology can get the most out of your team and create a more cohesive flow of information, plus it keeps all your data secure.
#7 Create an Inclusive Board Culture
The most important aspect of future-proofing any boardroom is to create an inclusive board culture that aims to get the most out of your entire team. You can put as much time, energy and money into the newest skills, the highest levels of training and the most expensive software on the market, but there’s little to no point to any of it if no one is listening to each other. A strong, supportive boardroom culture invites better listening, and will have your board greeting the future with open arms – no matter what it brings.
There are obviously many more ways to future-proof your board of directors, and don’t get me started on the integration of AI into your boardroom setup.
More on that to come….