Staying Out of the Board Composition Fray
There’s lots of attention these days on board composition, whether it’s an activist who wants to join your board, an investor who wants to see more diversity, a governance specialist who is touting the board skill du jour, or the NY comptroller who is issuing “new” matrix formats. How does your board not get this unwanted attention? It’s easy but requires meaningful use of the board skills matrix.
Traditionally, the skills matrix was a check the box exercise with little discussion. But now is the time to reap its advantages. Used meaningfully, it is a valuable tool to help directors visualize current board composition, connect company strategy with board make-up and create a road map for considering the board’s future talent needs. The skills matrix helps directors think through board succession planning. Here’s how to use it.
1. Review the current skills matrix used by the board. Ask: Does it include the needed skills and experiences to reach the company’s strategic goals?
2. Update the matrix; then ask each director to self-assess his/her own talents.
3. Ask directors to assess one another’s talents. Note: Directors often see their own and one another’s skills differently.
4. Ask, “what’s missing?” Reminder: not every company needs a director with the “skill du jour” and directors should be “checking more than one box.”
5. Ask for management input.
6. Analyze the gaps. Facilitate a full board discussion.
7. Consider pending retirements, skills of potential future nominees.
8. Along with skills, look at diversity of age, tenure, gender, ethnicity, geographic & economic status. Note: boards benefit when members have different perspectives and approaches to problem solving.
9. Consider the “interpersonal” element.
10. Repeat annually. Ask: Does the board have the skills and knowledge it needs; and, are there members who represent different business experiences and perspectives; and who have a customer and an employee frame of reference?
To receive a skills matrix template, contact email@example.com