Look to your board
Striving for engaged, diverse boards
Transparency and full disclosure are the best tools for helping leadership tap the expertise, talent and networks of board members, according to panelists who tackled the topic of “Untapped value: look to your board” Wednesday at the Forum.
Moderated by John Mitchell, Global Private Equity Practice Leader for Spencer Stuart, the panel featured Kay Koplovitz, Chairman & CEO, Koplovitz & Co., LLC, and founder of USA Network; Lorrie Norrington, Advisor and Private Investor, Norrington Advisory Services; Dennis Wolf, Chief Financial Officer and Executive Vice President of Fusion-io, Inc.; and Doug Bowers, President of Square 1 Bank.
Communication and trust: the first step
Several of the panelists, who served as CEOs and board members, agreed that developing a strong sense of communication and trust with the board was a key first step. “You have to pursue a continuous relationship with the board,” said Koplovitz. “You have to keep the flow of information open and transparent; the two most important characteristics for a CEO seeking to get the maximum leverage out of his board are trust and transparency.”
A key part of that is not waiting for quarterly board meetings to discuss financial results and business results. “Have calls between board meetings and tell them that this is what I’m thinking of doing,” Koplovitz added. “Most board members won’t look at that as a weakness, they should look at it as a strength.”
The model board: diverse and mirrors customers
Bowers said it is imperative to find the “sage” on the board, someone who can provide an even voice and put things in perspective. While CEOs of public companies rarely get to handpick their boards, CEOs of private companies do have that advantage. They should select board members who will help take the company to the next level, starting by bringing on a more diverse membership.
Norrington advised recruiting board members who look like their customers. “Make sure people who are living the experience of your customers are at your table,” he said, adding that CEOs need to know more than just the printed skills of board members. “It’s also what their informal skills are.”
Wolf added that diversity is important not only in ensuring that women and minorities are represented, but also in skill set. “You don’t want a board that thinks one way,” he said. “You need to have a good mix of people who have technical and strategic experience, as well as those who are well versed in corporate governance and financial acumen.”
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