By The Athena Alliance
Serving on a board allows you to use the whole of your career to provide value and strategic guidance to a company. While companies previously focused on older, retired CEOs or CFOs, a more modern take is to seek the expertise required to reach the next phase as a company. For some companies, that may mean digital transformation or enhancing its cybersecurity intelligence. For others, it could mean getting closer to the customer experience or having a stronger tie to their brand value with a Chief Customer Officer or Chief Marketing Officer.
Beyond your functional expertise, boards also evaluate:
- Your preparedness for a board director role (board savvy). It’s important that you can hit the ground running as you take on board responsibilities. To do so, you must understand your role as it shifts from an operator to a director. Boards want to see that you are knowledgeable about your duties in the boardroom and that you can lead by influence. For many first-time directors, it’s this fundamental shift in approach, from operator to director, that is the biggest transition. Simulation (helping you “practice” for a board seat and becoming more board savvy) is a cornerstone of the Athena’s experience.
- Diversity. Boards are increasing looking for diversity across gender, age, ethnicity, and perspective. A recent report by PwC shows that 62% of boards report women being a top priority for board recruitment efforts. Diverse boards perform better. Additionally, state laws, such as the recently enacted California law, are driving increased demand in female board directors.
- Industry or geographic expertise. You may be an incredible marketer or one of the top CIOs, but do you have experience in Asian markets or healthcare? As boards evaluate what their company’s next imperative is, and how a new director might help them achieve it, they may seek niche expertise in a particular industry or geographic region.
- Tech-savvy. You don’t need to be a CTO or Chief Digital Officer to add value in the area of technology or digital transformation. Digitization affects every area of business. The expectation today is that every board member has a basic understanding of how emerging technologies like Machine Learning, Automation, or robotics (to name a few) can transform a business.
- Risk management. Risk management is a growing concern for boards, and most boards roll the responsibilities of risk management into the Audit Committee. But many boards are asking themselves if it doesn’t require a broader-strokes approach, one that sees it as fitting into the overall governance duties of a board. Boards cannot manage the everyday needs of enterprise risk management, but every director should understand the flow of information as it relates to risk oversight, compliance requirements; many stakeholders, such as institutional investors, are increasingly calling for risk management to be treated as more of an integral governance responsibility.
- Culture fit. Can you work with your fellow directors effectively? Do you fit in and get along with each other? Culture fit is an important aspect of board directorship, not just with your board peers but with the overall company. Your understanding of the company’s culture, your ability to influence it, your observations of the CEO’s impact on culture, and your instincts for how values translate to culture (and, in turn, translate to action) are critical to stewarding long-term value at the board level.
Do you have a question for our Athena Alliance experts? Email Ask@AthenaAlliance.org.