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    Essential qualities of a director?

    Accountability Decision Making Governance Performance Research
    Recently, an article was posted on the ICSA: The Governance Institute website, describing 5 essential qualities of a non-executive director. The author lists the following five 'core qualities' and suggests these need to form the basis of evaluations when companies are appointing non-executive directors:
    • Big picture thinker
    • Governance knowledge
    • Independent mindset
    • Ambassador potential
    • Energy and commitment
    This is a good list and several of the items are intuitively appealing. However, having read the article a few times now and compared these suggestions with the findings from my own research and others elsewhere, I am not sure all of these qualities are actually 'essential'. This set me thinking, leading to some supplementary questions:
    • Why have these five qualities been singled out?
    • The fourth quality, 'ambassador potential', stands out as being somewhat different from the others. While some level of ambassadorial capability is desirable in the chairman (because they are usually the spokesman), I struggle to understand why it might be crucial in directors who do not speak for the company. The quality may be more usefully categorised as a desirable item.
    • The title of the article suggests these are essential qualities of non-executive directors. But what of executive directors? Do they possess different qualities? The law makes no distinction between executive and non-executive directors. If a board is to be effective, big picture thinking; knowledge of board practices (i.e., governance knowledge); an independent mindset; and, energy and commitment are more likely to be essential qualities for all directors.
    • What of other qualities that have been suggested as being highly important including competence (to understand the business of the business and complex information); the ability to deal with ambiguity and change; vigorous debate; and, teamwork and trust, for example?
    • Though not stated explicitly, the use of 'essential' implies these qualities are universally applicable. Given the complex and socially dynamic nature of corporate governance, companies and markets, is this reasonable?
    • How might possession of these qualities translate into a beneficial impact on business performance?
    Though progress has been made in recent years, these questions demonstrate our knowledge abut boards is far from complete. We still have much to learn about how boards actually work; how they should work; and, crucially, whether boards can influence company performance through the decisions made in the boardroom (or not). If answers to these very difficult questions can be found, they will probably have significant implications including perhaps to a new understanding of corporate governance and updated guidance for board practices, director recruitment and on-going director development. While some directors may struggle to come to terms with such implications, the flow-on effects for sustainable business performance, economic growth and societal well-being are likely to be significant.
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    On the cusp of something big?

    Accountability Governance Performance Research Tough Questions
    The last five years of my life have been dominated by research—the goal being to begin to understand how boards influence firm performance through their contributions in the boardroom. It's been a tough journey at times, but the end is now in sight—and thank goodness because a groundswell of interest in how my research might be applied to real situations is starting to become apparent. People in Australia; the UK; Europe; USA; South-east Asia; the Middle East; and, New Zealand have been in touch with questions and requests.
    While the research is yet to be published, enquiries are arriving from many quarters including invitations to write an editorial for a leading magazine; speak at the Governance Institute of Australia National Conference; participate in a multi-city (Europe and Asia) speaking tour in 2017; prepare a webcast; and, write a book for practicing directors. These are on top of confirmation from the prestigious Leadership and Organization Development Journal that an article of mine will be published soon (Vol 37, Issue 8), and earlier commitments to deliver a webinar to a world-wide audience; tailor a governance development programme for members of an industry association; and, facilitate several workshops to help companies refine their corporate purpose, strategy and governance frameworks. 
    That so many people have begun to question 'conventional' corporate governance thinking (that the board and management must be kept separate; that particular board structural configurations lead to better firm performance; and, that the term 'governance' can be widely applied including beyond the boardroom) has caught me somewhat by surprise. However, my commitment to serve boards and directors who are intent on exerting influence from the boardroom in pursuit of an agreed corporate purpose is a matter of public record. So respond I shall (and happily so).
    If you want to ask a question or toss around some ideas, please get in touch. I look forward to the discussion.
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    Building board capability: Extra UK/Europe visit scheduled

    Conferences Family Business Governance Performance Research
    Subject to two pending confirmations, the schedule for my upcoming visit to London (14–20 September) is full. During this short visit, I will be participating in the Organizations with Purpose conference (16–17 September) at London Business School (in conjunction with the Blueprint Trust); attending a non-executive director forum; meeting (separately) with ICSA and ICGN executives; discussing my involvement in a significant event in 2017; fulfilling requests for confidential meetings; advising several clients; and, delivering a presentation. While the visit will be fleeting (and busy!), I am hopeful of realising a long-time ambition: to climb the dome of St. Paul's Cathedral on Sunday 18th, my day off. 
    The high level of interest in my work has been both humbling and gratifying. Thank you for your support!
    Looking ahead, I'll be returning to the UK and Europe is in October (19–28th), culminating with the 13th EIASM Corporate Governance workshop in Milan (I will be presenting a paper there). If you would like to learn more about my governance research (especially implications for practice); have a confidential discussion about a sensitive topic; or, discuss the possibility of me addressing your board or a public event, please get in touch. Recent experience suggests that the diary is likely to fill up quickly, so it would be wise to act promptly.
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    Building board capability: London, in September

    Accountability Conferences Governance Performance Research
    How time flies. In just two weeks' time (14–20 Sept), I will be back in London again—this time to attend the Organizations with Purpose conference at the London Business School (thank you for the invitation), and to continue discussions with ICSA: The Governance Institute and others intent on building board capability. To serve boards and directors in the UK is truly an honour—I am looking forward to sharing ideas with colleagues and clients, and to meeting new acquaintances as well.
    While my diary is filling fast, I have room for a few more discussions. Please get in touch if you want to discuss emerging board practice trends, explore the possibility of me speaking at an event or with your board, or learn how to use my latest research findings to improve board practice and business performance. I'd be delighted to hear from you and look forward to scheduling a meeting (daytime or over dinner, whatever is best for you).
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    On diversity in the boardroom: A brief update

    Accountability Diversity Governance Performance Research
    The matter of diversity in corporate boardrooms has been the topic of much debate in recent years. Some people have claimed that the die is cast: that the presence of women (or some other group) in the boardroom leads to increased business performance. Others are less convinced. I have contributed to the debate on a few occasions, both as a panelist and in print. You can read some of my comments here and here, or use the search box to find other articles on diversity.
    While the debate goes on in the trenches, some commentators have begun to stand back, to offer a more holistic perspective. Jeff Jacoby, for example, has just written this article, published in the The Boston Globe. His balanced summary highlights various aspects of the debate. Two sentences stand out:
    "The evidence that more female board members means higher corporate profits is murky at best."
    "Either way, what no study has managed to nail down is causation."
    With these comments and others in the article, Jacoby has put his finger on the core of the issue. Board effectiveness (especially any relationship between board attributes and subsequent firm performance) is a complex issue. No one structure, composition or set of behaviours fits all situations (much less all companies). 
    Looking ahead, the challenge is two-fold. First, everyone who is interested and capable of making an effective contribution in the boardroom needs to be encouraged to offer themselves as a serious director candidate. Shareholders (or their nomination committees) need to work hard to find and appoint the best candidates—regardless of any physical attribute or notional diversity variable. The ability to govern well in the team environment must be the compelling basis of assessment. Second, the rhetoric needs to continue to mature, beyond the blunt instrument of observable characteristics to focus the subtleties of what actually matters—the capabilities of directors (individually and collectively) and the quality of boardroom interaction and debate as boards consider options; make strategic decisions; and, pursue performance goals in the context of the agreed purpose of the company.
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    Board effectiveness is possible and sustainable

    Accountability Decision Making Governance Phd Research Strategy
    Several months ago, the editors of Ethical Boardroom contacted me to write another article for their magazine. Previously, I'd written articles on governance issues in New Zealand and Australia and accountability; and, provided a commentary piece on internships. Given a free reign (within the bounds of editorial deadlines), I agreed to share some observations about the boards of social enterprises and, in particular, explore board effectiveness—all based on recent experiences in boardrooms and with members of social enterprise boards. The article is now available here.
    The commentary, which has generated considerable interest and feedback—including amongst directors and boards of profit-seeking companies—suggests that the 'secret' of effective board contributions lies in board members looking ahead and working together towards an agreed goal.  My doctoral research bears this out: the board's ability to exert influence from and beyond the boardroom (including over firm performance) seems to be contingent on the board maintaining a close involvement in strategic management, and a few (I found five) characteristics of directors and social interactions being expressed as the board does so.
    If the large number of people that have already seen the article and asked questions is any indication, the topics of board effectiveness and sustainable business performance are of great interest. The feedback has been gratifying. Thank you. If you want to learn more about board effectiveness; the underlying 'performance' characteristics of boards; or, how to embrace a high performance board environment, please get in touch.