At a Glance
The panelists break down the aspects of board service that continue to draw them in and the possible circumstances that might make them withdraw. The panelists present board service as dynamic, challenging, and intellectually engaging while flagging the situations that would make it untenable for them.
I am attracted to board service where I can make a contribution and a positive impact on the business, and I can be an asset and an accelerant. The old model of board service was more backwards looking, coming in to perform oversight, looking at last quarter’s performance. In today’s world, given the velocity of change in business models and technology, boards need to be “future proofing” and serving as a strategic thought partner for the CEO.
I would want to rotate off a board if my experience and perspectives weren’t additive or helpful. If a board already had three tech entrepreneurs, four serial CEOs, and two other board members whose perspective is digital transformation – well, that’s my profile! If I am redundant and can’t add value (it’s likely it would be less rewarding). Additionally, if a company is not recognizing the pace and dynamism of the competitive market and not moving with the right speed and velocity, then that scares me away. I don’t want to be a part of doing a poor job for the shareholders. I believe companies must keep up with the market dynamics.
Intellectual stimulation is number one for me. Board service gives me exposure to new businesses in another role. I deliberately chose to serve on boards that were related, yet adjacent to my area of operational experience. Further, as a board member involved part-time, I get to focus on the big picture and dig in on challenging issues – I really have the time to think deeply and connect dots. Board service also requires a different level of leadership. Operational leaders lead with a different cadence and different tools. Board members lead more by influence. It’s like testing out different muscles and that’s very engaging.
Board service is not for the faint of heart. We deal with a lot of big things such as unsolicited offers, activists, bankruptcy, or abrupt CEO departure. A good board member is not easily rattled. The only thing that would make me run is a mismatch in moral compasses – integrity is non-negotiable for me. This can be hard to assess sometimes, but a good indication of an issue is when business models aren’t focused on customer delight. If a company doesn’t take the customers, employees, communities, and shareholders interests to heart, most likely it isn’t going to work for them in the long run. You can’t always know you are joining a board of a business with integrity problems, but you should not stay on one once you figure it out.
I like to stay involved in the industries that I’ve worked in my whole life. The most effective way to do that after a certain age is through board directorships, and fortunately I’ve been invited to serve on a number of boards.
I am concerned by increasing obligations on corporate directorship, and some of the risks involved in that area. It is not easy to conduct your responsibilities as a director given the level of regulatory oversight, which in some ways is fair and appropriate but in other ways can be quite intrusive. Increasingly in Australia the example that comes to mind is director responsibility in the event of process failures that might lead to consumer litigation against the company, including directors. In order to understand the full extent of the risks being undertaken by the company, directors would have to serve as quasi-executives.
Making an impact on organizations internationally really drives me. I come from a global background and serve on boards in the US, an advisory board in Europe, and, of course, a board in Singapore. We are all connected globally and there is so much volatility right now anywhere in the world that businesses operate, both economically and politically. Especially in the next one to two years, I think things are going to get even more difficult and even more challenging. I can make an impact across geographic regions by mentoring and guiding leaders and serving on boards that are navigating these uncertain competitive times. That gives me the personal fulfillment of giving back to the way I was trained.
As far as what might make me run for the hills, I can give you an example. There was an advisory board I was on. The company was in the growth stage of venture capital. I was asked to be an investor, as well as to be on the board and help guide the company to growth. In my view, the technology was so disruptive : it was in the energy renewables sector and the company could well be on the path of rapid growth and deployment of its technology if it was managed wisely. I flew all the way from Singapore to attend the business review meetings. I provided many business insights into the organization about its ability to grow not just in the US, but in Asia and globally. I was also able to give the company directions on how to receive capital infusion from the public and capital markets.
But while I was working at the board level, in one meeting of the shareholders, only once, did the issue of tax liabilities creep up. This was never shared with me at the time when I was asked to be a board member. It turns out, the company owed millions to the US Federal government and also to the state. As a board member, I’m totally accountable and liable for the entire tax liability of the company, including the actions of management. Management on their own had decided that they weren’t going to pay the IRS and the state tax and use the money to pay employee salaries and past dues. What kind of management would make such a decision? And why would the board back then even allow that to happen? I immediately resigned and the Chairman of the Board followed immediately the next day. Good process and procedures, and even great products and technology can only guide a company so far. But if the values, beliefs and operating culture of the management is such that they do not believe in doing the right thing for the organization and the people, it will totally destroy the value of the company. This venture company had been operating for nine years. We could have expected a hockey stick type growth, After the resignations of myself and the Chairman, the company imploded a few months later.
When companies or boards want you on their boards, they can say all sorts of things. They promise you the world. I know I can add so much value to the company, but I can’t reverse decisions which were executed before my time.
My fear and phobia now is getting involved with people who refuse to do the right thing, have no values or integrity. I need people who have the same values I do. Hard to really know if that really exist in people sometimes , until you’re in the heart of things!
I keep coming back for three main reasons. First is the heterogeneity – if you’re lucky, you serve on boards for companies that do different things or are in different sectors. Second, it is exhilarating to work with different people at the top of their game. And third, you can actually help. Board service is not completely altruistic, you get money and intellectual stimulation, but it might help the company get better. That’s why you do it.
I have left boards ahead of the six year cycle just because I stopped believing that the company could make progress. If you notice that happening, then you should get off the board either because someone else can help them better, or because no amount of pushing and shoving will get the company healed and so your effort is better somewhere else. Most non-executive directors know that, and sometimes you’ll see a number of them leave a company all at once. Luckily this is rare, but it is important to know when it happens.
Betsy is a Director on the Boards of Directors of Cognizant, Wynn Resorts, SI Green Realty, Schneider Electric, and Volvo Cars.
Nora is currently a member of the Board of Directors at Advanced Micro Devices (AMD), Ericsson, and Talend SA, as well as a member of the Innovation Advisory Board at BBVA. She has previously served on a number of boards including Saba Software, Overland Storage, TimeSpring, YWCA of Silicon Valley.
Leslie serves on the Boards of Directors of AGL Energy Ltd. And Adelaide Brighton Ltd., where he was the board chair from 2012-2018. He has previously served on the boards of the Australian Energy Market Operator (AEMO), The Carbon Market Institute, and Innovation Australia.
Colin is currently the Chair of the Singapore Investment Development Corporation (SIDC), Chairman of the Board for Singapore Mainboard listed Intraco Limited, and US National Board Member for the Cancer Treatment Centers of America (CTCA).
Stuart is currently a Non-Executive Director at Lloyds Banking Group and Senior Independent Director at QBE European Operations. His previous board roles include being a Non-Executive Director at Provident Financial Group and a Senior Independent Director at Swinton Insurance.