5 ways to improve yourself as a board director
5 New Year resolutions for board directors:
1. I will ask the third and fourth question that finally pierces the veneer of management’s often obtuse, protective response.
2. I will recognise – and accept – the importance of non-financial factors in forming shareholder judgments and see to it that soft values (vs. hard assets) are addressed proportionately.
3. I will consistently bear in mind that the ultimate judge of best practices are the shareholders – not regulators or my peers.
4. Judging attitude on a par with aptitude, I will be sensitive to the demeanour and personality of the chief executive, and counsel, privately, should it be necessary.
5. I will do what I can to assure that my board is proactive not reactive, accepting the sports maxim that the best defence is an offence.
Jim Christie, Directors & Boards (January 2008)
Kenyans are now embracing each other and shouting ‘Happy New Year!’ – in March! As the spirit of change takes root in the country following the successful political mediation, I thought it opportune to look at what one particular group – board directors – might want to change.
The list above reveals one thing very clearly: the job of the modern board director is a very serious job indeed. It used to involve merely attending four tightly scripted, extremely dull meetings every year, followed by an enjoyable lunch amongst one’s social peers.
All of that has been rapidly going out of the window in recent years. To be a director in today’s complex and highly competitive businesses, and in today’s very demanding governance environments, you have to be on top of your game, not well past your prime.
The ‘resolutions’ above suggest that this job is a series of balancing acts: between scrutiny and support; between monitoring and counselling; between numbers and emotions. The modern board director has to be a number cruncher as well as a people person, a wise advisor as well as a strict auditor, a watchman as well as a driver.
If you are a board director, it is time to assess your own effectiveness and impact. Are you asking the right questions at the right time? Have you understood the personality and the natural strengths of your CEO? Are you able to look beyond numbers and understand the ‘soft’ side of the business: skill sets, customer needs, relationships and networks? Are you hawk-eyed in your scrutiny of warning signals in the business?
This is not a job for the faint-hearted. You will get little credit for doing it well (the CEO will hog most of that); and plenty of blame for sitting back. So let only those who can do it take up the challenge.