Evaluating Your Next Board Director
The qualities that make – or break – board leadership.
By Robert Hennessy
From spearheading strategy to protecting shareholder interests, board directors have enormous power, control and responsibility. So what qualities define effective board leadership?
A recent study by AIMS International Canada analyzed the behaviors of board directors and identified six specific competencies and their weighted value:
- Sense of ethics (90%) – Demonstrates a high sense of integrity and puts forward strong values related to ethics.
- Strategic thinking (83%) – Has a clear vision, anticipates trends and considers the risks associated with strategic decisions.
- Commitment and sense of responsibility (82%) – Honors its commitments. Shows availability and assiduity. Spares no follow-up.
- Judgment (80%) – Knows how to put things in perspective and sets priorities after assessing the facts objectively.
- Communication (76%) – Able to share his views with clarity by promoting the adhesion of others.
- Team intelligence (75%) – Focuses on common goals, priorities and problems through active listening of the concerns expressed by others by focusing on teamwork.
The behavior that rose to the top of the list is a sense of ethics. Naturally, a leader’s sense of ethics can be influenced by his or her motivation to sit on a board. If social status and compensation are overly important, then the board director may shy away from rightfully challenging the CEO.
Strategic thinking also ranks high on the list. From the ability to make decisions with limited information to properly assessing risks, thought leadership is critical to effective board leadership. Soft skills such as commitment, responsibility, judgment, communication, and team intelligence round out the list of top behaviors shared by effective board directors.
Do men and women view board director competencies differently?
The study also examined whether or not there were differences between how men and women perceived the core competencies of board directors. Essentially, the study found that women and men share the same vision about the essential competencies. However, there were significant differences in the Communication category. For example, the study reported that men gave a very strong rating of 94.7 for “Say what they think, believes and feels in a transparent manner” while women rated the same statement as the lowest with a rating of 75.3.
By examining these findings, the study ascertains that “Male communications codes currently dominate in the boards. To increase the ratio of women on boards, the challenge is on the one hand for men to learn to better appreciate and understand the female communications codes and for women to adapt their communication style to promote their integration.”
How do companies attract high-performing board directors?
Now that you know what board leadership qualities are most desirable, you may be wondering how to attract the individuals who possess them. To help you do just that, consider my list of top five ways to find your next high-performing board director:
- Look at the senior leaders of high-performing companies – don’t overlook talent in neighboring countries
- Consider companies with a high ratio of women and diversity candidates at the most senior levels
- Network with directors who have worked with diverse boards and ask, “If you had to add another board member, who would you consider?”
- Develop a portfolio of board-level candidates in advance – proactively go after them as if it is always an open, active search
- Target boards of companies and senior executives who have managed through adversity to become a market leader or who have successfully expanded into new and emerging markets
A good board director can help strengthen and lead your company. With a thorough evaluation process, you can be sure your next board director is the right one.