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by Lisa Marsh
Sep 26 2014
On Sept 17, 2014, BlueSteps hosted its annual diversity webinar, entitled Closing the Gap: New Opportunities in the Boardroom. During this event, an influential and expert panel gathered to discuss topical issues relating to diversity and the boards.
Moderated by AESC Managing Director of Global Marketing, Joe Chappell, the panel comprised of Jeanne Branthover, Managing Director at Boyden Global Executive Search; Krista Walochik, Managing Partner at Talengo; and Priya Chetty-Rajagopal, Executive Director of Leadership and Board Practice at RGF India.
The panel discussed a breadth of topics including the changing world of the boardroom, the board recruitment process and how to develop a strategy to obtain a board seat. With such an extensive and varied experience of the board, our distinguished panelists were able to relate to each topic from the point of view of the practitioner, the advisor and the search consultant.
New Legislation and the Effect on the Boardroom
The panel first focused on the effect of new legislation relating to the boardroom. Due to the more stringent laws that have been put in place to monitor the workings of the boardroom, such as the Sarbanes Oxley Act, the relationship between the CEO and the board has been placed under scrutiny. Many believed that the increased pressure placed on both the CEO and the board would result in a strained relationship between the two. Yet according to our panel, this has not been their experience.
Since the introduction of such new legislation, panelist Jeanne Branthover explained how the relationships between the board and CEOs have actually improved. With higher levels of skills and experience being demanded of new board members, the boards themselves are becoming stronger entities. And the stronger the board, the better results for the company and the better the results for the CEO.
In fact, many people are beginning to treat board work more seriously as a direct result of these changes. In the past, board work was seen as something that CEOs do when they are “let out to pasture” upon retirement, however there is now a growing number of people who are retiring out of corporate life early in order to focus on their board work.
The Global Impact of Diversity in the Boardroom
Throughout the webinar, it became clear that there are two key words which are integral to any board/diversity discussion: pressure and change. With boards understanding the importance of diversity, especially concerning female participation, there has been more pressure on boards to change. It has been proven by several leading reports that diversity leads to better business results, however, the issue now, is not the why, but the how (and how fast) women and other minority groups should gain a higher percentage of board seats.
Woman are becoming more assertive in stepping up for roles, however, the process is still incredibly slow, due to the fact that many board members are so called “lifers,” and openings do not come up very often. Even when positions do become available, some find it difficult to find women who are considered to be “suited” to the role. This has led people to question where the progress of diversity on boards should be artificially assisted by governmental bodies.
The board environment has changed, but the extent of this change depends heavily on your geographical location. The needle has definitely been moving in certain parts of Europe, and in countries like the UK they are trying to move the needle on a voluntary basis. However, in the United States, there has been a disappointing lack of change, at least as far as public boards are concerned, with the percentage of women on boards barely reaching the high teens.
But for those wanting to present themselves as a solid board candidate to break this pattern, there are many actionable pieces of advice that our panel offer for future candidates.
What boards looking for in future candidates?
Knowledge, experience, protecting the companies interests, and your personal values are of course integral to securing a board seat, however, there are several other skills and qualities that candidates can work on to put themselves ahead in the race to secure a board seat.
Moulding yourself into the perfect board candidate is a lot like building a resume, or developing an expert personal brand. Candidates must get themselves into a situation where they are known as a leader in their field, and become visible to a wide audience. There are many ways that this can be achieved. One example given by our panel on how to achieve this included volunteering to speak at conferences. This will make the speaker recognized by the industry, and build their credibility.
Even if you are not speaking at a conference, conferences are important to attend. It is important to build a strong network of connections. Connections can be vital in securing global business deals and so if useful connections can be demonstrated to a board, this will help make the candidate appear stronger. It was also recommended to network with those in private equity, and to become a shareholder and attend shareholder events.
Gaining a mentor can be a great way of building a network and gaining valuable advice, which can greatly impact your chances of securing a board seat. For those unable to gain a mentor, but who still wish to learn more about the intricacies of board work, there are many institutions (including several leading business schools) that can provide training courses to help with preparation.
Joining an advisory council for a non/not-for-profit organization can also be a gateway into further board positions and should be explored by those wanting to gain valuable experience in this area.
Finally, panelist Priya Chetty-Rajagopal recommended that candidates take on P&L responsibility, and run it over three periods of financial reporting to build their credibility and demonstrate their fiscal acumen.
Regarding women in particular, there are several things that can be done to increase your chances of gaining a board seat. Women have many qualities that can be exploited by boards and which make them ideal board candidates. Priya cites that women specifically bring warmth and empathy to the role and are often able to see things from an alternative, fresh perspective, which is beneficial to all. As women have to fight to attain their board seat, they are less likely to take it for granted and are subsequently more engaged in the role. This makes them less likely to “wing it” regarding research, and more likely to contribute to meetings.
It will take initiative from women to be proactive to make themselves qualified and get on boards. Women, especially those in areas without government legislation, will need to try more aggressively to get on boards, however, it is an achievable aim, and one that is becoming increasingly reachable.
To register for our next BlueSteps webinar, Compensation Negotiation: Getting What You Deserve, click here.