How having a board mentor supports lifelong learning

As told to Karen Loon, IDP-C and IDN Board Member.

“Never hesitate to ask for guidance, empathy, advice and support” – Virginia Brumby Ferreira

Virginia Brumby Ferreira MBA’09J, a recent mentee in the 2020 INSEAD Directors Network (“IDN”) INsights Director Mentoring Programme is a typical INSEAD MBA.  After completing her MBA, she became an entrepreneur, leader, and board director.

“In true INSEAD spirit, I changed absolutely everything post-INSEAD: I moved to a new country, switched sector, and became an entrepreneur for the first time – in fact, the business I set up was my INSEAD MBA project!  A decade later, after the most challenging, fulfilling (and fun!) decade of my life, I am still running that same company. None of it would have been possible without my incredibly supportive INSEAD friends and network”.

As a result of her enthusiasm to give back, she has been an active member and has taken on board and leadership roles with the Singapore NAA, as well as the INSEAD Alumni Fund.

On how she developed her board portfolio, “’Pursue’ is not the right word; my board roles are more a consequence of my chronic inability to say no. Friends call me a ‘serial volunteer’ since I tend to constantly raise my hand and get involved in all kinds of projects, from fundraising to event organisation to helping out aspiring entrepreneurs and businesses with their strategy and communications. After years of involvement, there was a natural evolution into more board and leadership roles”, Virginia shared.

Lifelong learning from director mentors

In 2020, Virginia felt it was time to invest in her board career, and joined the INsights Director Mentor Programme.  She was matched with an experienced female board chair.

“Having been my own boss for many years, as well as an Entrepreneur-in-Residence at INSEAD, I was thrilled at the prospect of getting advice and guidance, instead of giving it!”

Virginia met her mentor, who was based in a different country, monthly, via Zoom.  They adopted a relatively informal approach that fit their personalities and goals for the programme, but with action points to follow up on after each discussion.

The range of topics discussed was also broad.  “Some of the subjects I most enjoyed discussing were the most unexpected – such as appreciating the role of serendipity in our personal and professional lives, knowing when it’s time to close a door, and making the ‘highest and best use’ of our most precious resource – time!”

Virginia enjoyed sharing experiences with her mentor.

“Being able to share openly with both my mentor about our respective journeys — including the disastrous moments! — helped me put my own challenges in perspective and find a way forward” – Virginia Brumby Ferreira.

Learning from director peers

Another benefit was having an opportunity to learn from and be supported by other mentees through the monthly mentee sessions.

“I found the group discussions with my fellow mentees both practical and inspiring. They shared a wealth of experience, and the overall atmosphere in the group of acceptance, inclusivity and encouragement was especially important during this roller coaster year”, she remarked.

Leveraging the power of the INSEAD network

Virginia suggests that new directors should seek advice early in their careers.  “Even the leaders we most admire and idolise (the mentors in this programme are excellent examples) didn’t get there on their own. Never hesitate to ask for guidance, empathy, advice and support”.

She highly recommends that a good place to start is to leverage the INSEAD community and in particular, in relation to board experience, other IDN members.

 

To find out more about IDN’s INsights Director Mentoring Programme, visit here.

 

INSEAD Directors Network (“IDN”) – An INSEAD Global Club of International Board Directors

Our Mission is to foster excellent Corporate Governance through networking, communication and self-improvement. IDN has 1,500 members from 80 countries, all Alumni from different INSEAD graduations as MBA, EMBA, GEMBA, and IDP-C. We meet in live IDN webinars and meet-ups arranged by our IDN Ambassadors based in 25 countries. Our IDN website holds valuable corporate governance knowledge in our IDN blog, and we share insights also to our LinkedIn and Twitter  followers. We highlight our member through quarterly sharing of their new board appointments and once a year we give out IDN Awards to prominent board accomplishments. We provide a peer-to-per mentoring and board vacancy service and we come together two times per year at the INSEAD Directors Forum arranged by ICGC. We also engage with ICGC on joint research.

INSEAD Corporate Governance Centre (“ICGC”)

Established in 2010, the INSEAD Corporate Governance Centre (ICGC) has been actively engaged in making a distinctive contribution to the knowledge and practice of corporate governance. The ICGC harnesses faculty expertise across multiple disciplines to teach and research on the challenges of boards of directors in an international context and to foster a global dialogue on governance issues with the ultimate goal to develop boards for high-performance governance. Visit ICGC website: https://www.insead.edu/centres/corporate-governance

 

Modern Chair Practices: What makes an effective board chair?

By Karen Loon, IDP-C and IDN Board Member

Board chairs will continue to play an important role in engaging, enabling, and encouraging their boards and companies.

Effective chairs play a critical role during times of change and uncertainty. 

Whilst the recent pandemic has impacted how boards operate, it has had a significant impact on the role of board chairs, how chairs work, and what makes them effective, according to Stanislav Shekshnia, Senior Affiliate Professor of Entrepreneurship and Family Enterprise at INSEAD and Director of Leading from the Chair Programme and Helen Pitcher OBE, INSEAD Directors Network (‘IDN”) President who recently shared their perspectives on emerging trends in board chairs’ practices in an exclusive webinar for IDN members.

Attendees had the opportunity to get a preview of the key findings from ongoing research on chairs’ practices in Europe across 15 countries, 200 chairs and 300 shareholders, directors and CEOs including during the pandemic.

The research, with some contributions from the IDN[i], will be released by Professor Shekshnia in the upcoming second edition of his book, Leading a Board: Chair Practices Across Europe.  The webinar was facilitated by Liselotte Engstam IDP-C, with support from Hagen Schweinitz IDP-C, both IDN board members.

Over the past few years, the environment in which boards operate in has changed and became more challenging.  Companies are now subject to more public scrutiny, need to be more transparent, accountable and do more reporting.  Boards have been busier than ever, particularly since the start of the pandemic.  

Effective chairs lead their boards through Engaging, Enabling and Encouraging

Professor Shekshnia’s research concluded that effective chairs have continued to lead their boards by providing the 3Es of chair leadership – Engaging, Enabling, and Encouraging their boards, consistent with his prior research.

The role of chairs however has changed during the pandemic.  “What we found (was) that during the pandemic, chairs became more emotionally involved with their boards, (and) they spent more time doing their jobs”, said Professor Shekshnia.

Additionally, leading chairs are innovative in the way they lead their boards.

Finally, board work has become more relevant during the crisis, with only 1.2% of survey participants saying their board is irrelevant.

Leading practices of chairs which have emerged in the past year include:

Engaging

  • Chairs have become more caring – spending more time with each director; having more frequent contact; paying attention to mental and physical health; and having more personalised engagement.
  • Boards are engaging more over long-distance using technology such as Zoom, phone calls, Group chats and polls. Most hope to use face-to-face interactions when possible.

Enabling

  • Changing agenda items – new agenda items include COVID-19; employee, customers’ and suppliers’ health and safety; CEO health and fitness; and boards’ and individual directors’ resilience. Boards are also paying more attention to sustainability, succession planning, employee well-being, and social corporate responsibility.
  • Agenda setting – Leading chairs involve their directors more in setting agendas, using technology to set them. They also adjust agendas more frequently during meetings.
  • New formatsBoards are inviting experts to meetings, creating advisory boards and mixed board-management groups, and bringing in non-voting members to assist boards where there are skill gaps.
  • Innovation in managing board discussions online – Boards are experimenting with different online formats such as “camera on, mike off” mode, groups in Zoom, polling directors during the meeting, undertaking express evaluations at the end of each board meeting, and even turning off directors’ mikes!

Encouraging

  • Greater care and empathy – Leading chairs are supporting their boards, management and organisations with greater care and empathy, with less feedback and more support. They champion board education by acting as a “Chief Learning Officer” with their boards, and immerse themselves into new subjects like COVID.  Popular ideas used in lieu of in-person events include tea parties and drinks before and after virtual board meetings.

Virtual meetings have become a proven instrument for most chairs in Europe and will continue to be used going forward.

In the future, boards are likely to use a mix of virtual and face to face meetings, with big debates such as strategy being saved for face-to-face sessions, more operational questions for virtual meetings, and other more routine information sharing undertaken outside of the board room.  Helen Pitcher further added that more virtual meetings have had a positive impact on the environment, because of reduced travel.

An evolving idea is the changing attitude towards risk management.  Boards now have greater recognition that they need to move from classifying risks to organisational adaptability and resilience.

“Most of the board’s looked at risk in a sort of set standard way.  We identified the most important risks. We tried to come up with (a) strategy to deal with every specific risk. And we monitored the risks ranking them in accordance with their probability … Now most of the boards have (an) understanding that in addition to this, we also need to see how resilient our organisation is; how flexible we are.” – Professor Stanislav Shekshnia.

Boards are likely to focus more on the health and safety of employees, customers, suppliers, board members and the CEO in the future.  Empathy and mentoring are expected to be used more as performance measurement tools, as metrics have become less relevant.

What makes an effective chair?

Being a chair requires the chair to “balance” different attributes.  It is not about having one attribute or another, but about being ambivalent (or plus and minus) at the same time.  The opposite pairs are:

  • Authority and humility
  • Commitment and detachment
  • Incisiveness and patience
  • Helicopter view and company knowledge
  • Hard and soft skills

Professor Shekshnia concluded that the impact of the board chair on board effectiveness has always been significant, however in 2020 became critical because of the high change and uncertainty that we lived through last year.  The board chair’s role and impact will continue to be critical in 2021.

The changing role of the chair – Experiences of chairing boards during the pandemic

Helen Pitcher OBE shared her personal experiences from chairing boards across a range of organisations during the pandemic, noting that the pandemic has had a significant impact on how boards work.

“This is a once in a generational opportunity to change ways of working.  We’ll never again be able to say the way we used to do it, or we tried that, and it didn’t work because we are having to rethink everything that we do, and how we do it”, said Helen.

“Good chairs were already doing a lot of the things that needed to happen and were able to gear up quickly to support their boards and their organisations through the crisis.” – Helen Pitcher OBE. 

Some of the areas that chairs have been focusing on are:

Impacts on the transformational agenda during the pandemic

Shifting goals and outcomes

Health and safety, mental health and well-being, and what our goals and outcomes should be have become more important for boards and their chairs.

For some boards, the pandemic has been an opportunity for them to look at how to build their businesses and move them forward.  However, other organisations have been in crisis; their boards are meeting far more frequently, which demands a lot of the chair’s time.

“All chairs are having to work far, far more in their boards and on their boards, and to keep the communication flow going”, Helen remarked.

On developing relationships, “it’s become even more important for chairs to hold pre-board sessions, post-board sessions with all the board, and indeed with other key stakeholders to see how things are going”.

Finding opportunities for informal interactions, such as “board gin and tonic” events with no business agenda to find out how people are have been helpful.

Communication and messaging

“Being able to continue to communicate, particularly at a time of pandemic and fatigue is really, really important” – Helen Pitcher OBE. 

Chairs and board members should be prepared to have sessions with people across their organisations.  “You can never overcommunicate… having clarity of message and making sure we’re keeping people up to date is absolutely, absolutely crucial” Helen stressed, adding that chairs and board members need to listen even harder in these times.

Transformational change with assurance

Many employees are anxious about the future, for example the impact that new technology will have on them, or about moving offices and what the impact would look like.

“It’s even more critical that the board is supporting the executives to have the right conversations within their organisations, and to have deep conversations, both formal and informal.” – Helen Pitcher OBE.

She recommended that chairs and board members take “time to listen to people to talk about their concerns…. so that as much of the uncertainty as you could possibly take away is taken away”.

The immediate role of the chair in the crisis

  • Supporting executives – Board chairs have a key role to encourage their organisations, acting as a sounding board for executives, and to mentor and coach them, bringing their previous experience to bear.
  • Strategic horizon – Leading boards are also spending a lot of time looking at the future of their organisations, giving their people hope that there is a brighter future for them. “We need to constantly be scanning the horizon to see what we can learn from others.  The board’s learning individually and collectively is very important, because that keeps them fit for purpose for moving forward”.

The strategic role of the chair in the crisis

Boards have a responsibility to ensure that decisions made are sensible for the emergent reputation of their businesses.  How boards and chairs respond during the crisis will be remembered internally and externally going forward.  “Managing that reputation is hugely important, not only because it is morally the right thing to do, but because it’s sound business sense”.

Other strategic areas where chairs play a key role include inclusion and diversity, supporting exhausted executives, and managing executive remuneration.

In concluding, Helen highlighted the important role of chairs to maintain the transformation narrative in the crisis:

“Things are changing, but we will not go back to the old way of being. We will always now focus, even more strongly on to things like risk management, health and safety, how we reward our people – we absolutely owe it to our organisations as boards to do all of that.

We really also need to make sure we are being reflective about what have we learned from this crisis that we can really take forward. 

How can we be more flexible and more agile as a business in order to ensure that all our stakeholders benefit from this, and have the time to think, what is good … and what needs to change.” – Helen Pitcher OBE.

 

IDN’s next webinar on Governance at Family Boards will be held on 8 March 2021.

 

INSEAD Directors Network (“IDN”) – An INSEAD Global Club of International Board Directors

Our Mission is to foster excellent Corporate Governance through networking, communication and self-improvement. IDN has 1,500 members from 80 countries, all Alumni from different INSEAD graduations as MBA, EMBA, GEMBA, and IDP-C. We meet in live IDN webinars and meet-ups arranged by our IDN Ambassadors based in 25 countries. Our IDN website holds valuable corporate governance knowledge in our IDN blog, and we share insights also to our LinkedIn and Twitter  followers. We highlight our member through quarterly sharing of their new board appointments and once a year we give out IDN Awards to prominent board accomplishments. We provide a peer-to-per mentoring and board vacancy service and we come together two times per year at the INSEAD Directors Forum arranged by ICGC. We also engage with ICGC on joint research.

INSEAD Corporate Governance Centre (“ICGC”)

Established in 2010, the INSEAD Corporate Governance Centre (ICGC) has been actively engaged in making a distinctive contribution to the knowledge and practice of corporate governance. The ICGC harnesses faculty expertise across multiple disciplines to teach and research on the challenges of boards of directors in an international context and to foster a global dialogue on governance issues with the ultimate goal to develop boards for high-performance governance. Visit ICGC website: https://www.insead.edu/centres/corporate-governance

 

[i] IDN collaborates in many ways with ICGC. ICGC shares academic insights with the network, and provides opportunities for joint research. IDN shares experiences at several of ICGCs programs and events, and shares INSEAD insights with their boards and at many events. For the referenced chair practices research, led by Professor Stanislav Shekshnia, IDN President Helen Pitcher OBE has contributed with significant insights to both the topic and network, and IDN Board Member Liselotte Engstam has engaged for two years in the research performing the research on Swedish chair’s and board work, as well as contributed to the Nordic insights and co-authored the forthcoming book by writing one of the chapters.

 

Why Some Boards Add Value and Some Don’t

Webinar Summary of Lifelong Learning IDN Webinar

By Karen Loon IDP-C with inputs from Roy Ling GEMBA

How do boards and board directors best equip themselves to deal with the challenges of innovation and disruption, and how do they add value? 

INSEAD Directors’ Network (“IDN”) members Denise Koopmans IDP-C, Roy Ling GEMBA, and Hagen Schweinitz IDP-C shared their diverse views and experiences on these questions in an INSEAD Lifelong Learning session by IDN, sponsored by the INSEAD Alumni Association on 19 January 2021.  The session was chaired by IDN Board Member, Liselotte Engstam IDP-C.

Prior to the session, participants were surveyed and asked to share their views on the effects their boards have on company value. The key findings suggest that the top area which boards have been focusing on in more recent times is value adding strategies.

The panellists shared their candid views and insights, as well as practical feedback on key developments in corporate governance in more recent times.  These included:

  • How boards can be successful at creating value – Successful boards invest sufficient time on board work; maintain a well-rounded team; and have an effective chairperson who runs meetings well, as good leadership sets the tone for the board as a whole and sets the stage for a more value enhancing board.  As Roy Ling shared:

Boards should maintain a well rounded team with a culture of trust and respect, where directors and management challenge each other with constructive feedback”.

  • Changing dynamics in the way boards work – Boards are becoming increasingly agile and forward looking, working together through many challenges. They are discussing strategy and scenario development more frequently.  More backward-looking topics are being discussed in committees.  Decisions are being made faster, there is more focus on task forces to deal with certain topics, and more open flow of information.
  • Having board diversity – Not just in the areas of gender, age or experience, but diversity of opinion, personalities and capabilities. Directors need to be comfortable with differences of opinion.  A question which was discussed was how good companies are at finding independent directors.  The panellists also shared that whilst specialist skills such as digital, innovation and sustainability are important, directors also need to have other skills such as leadership and being able to operate in a team to be effective in the boardroom.
  • A growing focus on board reviews – With the increasing need to further professionalise boards, leading boards undertake regular self-assessments on board performance on Board composition and dynamics, how boards perform specific board tasks and how boards operate. More advanced organisations focus more interviews and less on questionnaires.  Annual review processes including the use of peer reviews with 360-degree feedback are also becoming more common.  Many also obtain external third party periodic “health checks” to evaluate the feedback process.

Participants highlighted that they believe that the top area of focus of their boards in 2021 will be digital innovation.  The panelists also shared that areas such as talent management, human resources and effective board processes should not be ignored by boards in 2021.  As Denise Koopmans shared:

Boards have  become more leading, agile and forward looking. They have speedy and resilient decision making processes with ad hoc committees, deep dives and task forces as support. The board agenda is more geared towards strategic challenges and the role of the Chair as facilitator is critical.

On board processes, many boards remain focused on upholding corporate governance and compliance with regulations.  However, a challenge is that directors who have extensive views on how to reinvent the company and its business model may often not receive adequate attention from the board due to limited board time. One suggestion was that perhaps an ‘Innovation Committee’ should be formed to get more board attention. The innovation committee role is to actively motivate and facilitate management’s ideas and initiatives on innovation and productivity.

Another idea was that a review of the board’s agenda is a good way to measure board effectiveness. If the same items are appearing on the agenda with no resolution, it may be an indication that the board lacks the necessary expertise to deal with the issue.

How can directors keep up to date?

A challenge for most directors is how can they keep up to date as a board member.  In addition to leverages such as the IDN network, recommendations included:

  1. Engaging between board meetings. Not just about spending more time on board strategy, it’s also about being able to connect with management in between meetings and staying current. But how often should they meet? Boards need to experiment to figure this out, but the key is to remember that boards are only as good as the information they have access to.
  2. Engaging with strategy as it is forming. Directors can participate early in the formation of strategy and stress-test it along the way, as opposed to reviewing a strategy that’s been fully thought through by management.
  3. Engaging on the tough questions. It is important to ask uncomfortable questions that extend beyond strategy sessions to a wide range of issues. Every board member does not necessarily need to have industry experience, but you must have the courage in the boardroom to ask the difficult questions.

As Hagen Schweinitz shared:

Being a board director is now a profession with a lot of obligations. And future board reviews will look at how board members behave, interact and how independent they are.

COVID-19 has reshaped board strategy

COVID-19 has certainly disrupted and reshaped how boards undertook strategy work in 2020. While many boards are tempted to refocus from long-term growth to short-term survival due to COVID-19, this could be a grave mistake. Instead, boards should capitalize on the COVID-19 opportunity to reposition and pivot their companies to strengthen their positioning and come out ahead. The participants suggested that boards need to be aware of three areas.

  1. Resilience comes through speed. COVID-19 gave rise to many uncertainties and changes. But boards need to guide management processes for fast responses. The point isn’t to have the right answer. The point is to build organisational capability to learn quickly why your answer is wrong and pivot faster than your peers do.
  2. Beware of a gulf between board and management and workers. While it is relatively easy for boards and management to switch to remote working, and they see it as effective and efficient, those in the trenches may not see it as so.
  3. More than ever, a bias to action is essential, which will frequently mean getting comfortable with boardroom disagreement.

Looking ahead

While 2020 has been a year of disruption, 2021 is a year of renewal.  Some areas for board directors to watch out for are:

  1. Always work on your own game as a director – Continuing education remains important.
  2. For people who want to join boards, carefully check if there is a match between your skills and the needs of the company, as well as a good fit and trust. Remain resilient and have sufficient time for your board roles.
  3. Spend even more time on board strategy – Manage through the COVID-19 crisis and into the new normal. Renew board processes to make them more effective and efficient.  Balance trust with challenging discourse.  Consider appointing an ambitious Board Chairman and rethink the annual agenda in 2021.

 

INSEAD Directors Network (“IDN”) – An INSEAD Global Club of International Board Directors

Our Mission is to foster excellent Corporate Governance through networking, communication and self-improvement. IDN has 1500 members from 80 countries, all Alumni from different INSEAD graduations as MBA, EMBA, GEMBA, and IDP-C. We meet in live IDN webinars and meet-ups arranged by our IDN Ambassadors based in 25 countries. Our IDN website holds valuable corporate governance knowledge in our IDN blog, and we share insights also to our LinkedIn and Twitter  followers. We highlight our member through quarterly sharing of their new board appointments and once a year we give out IDN Awards to prominent board accomplishments. We provide a peer-to-per mentoring and board vacancy service and we come together two times per year at the INSEAD Directors Forum arranged by ICGC. We also engage with ICGC on joint research.

INSEAD Corporate Governance Centre (“ICGC”)

Established in 2010, the INSEAD Corporate Governance Centre (ICGC) has been actively engaged in making a distinctive contribution to the knowledge and practice of corporate governance. The ICGC harnesses faculty expertise across multiple disciplines to teach and research on the challenges of boards of directors in an international context and to foster a global dialogue on governance issues with the ultimate goal to develop boards for high-performance governance. Visit ICGC website: https://www.insead.edu/centres/corporate-governance

Resource list

INSEAD Corporate Governance Centre (“ICGC”) research and articles

A checklist for boards in the new normal (INSEAD Knowledge Post)

Leadership in Risk Management (report)

The market for corporate directors (report)

Innovation & Corporate Renewal also disrupt Boards (report)

IDN Blogposts with related insights 

The evolving role of the board in the Covid-19 environment 

Board Dynamic Capabilities in Disruptive Times 

Can Digital Committees solve board challenges 

Getting your first board position 

Related webinar recordings

The End of Shareholder primacy?

Driving Tech for Good, the role of Company Boards 

Related Podcast Interviews

Create and believe in the Future with INSEAD Strategy Professor Nathan Furr

Experienced Board Chair INSEAD President Helen Pitcher OBE

Interview with Dr. Carole Ackermann, 2020 IDN Award winner

“To be successful as a board member, you really have to love what you’re doing” – Dr. Carole Ackermann

Interview with Dr. Carole Ackermann, IDP 8 2015, Chair, École hôtelière de Lausanne

 

 

 

 

 

 

 

In October 2020, INSEAD Directors Network (IDN) announced the four winners of the 2020 Inaugural IDN Awards for prestigious board positions.

The winners, which were selected from the 230 mandates, shared via the quarterly IDN Board Position Announcements, were selected based on the size and and importance of the organisations they represented, their global relationships and the position at the board, in combination with pursuit of INSEAD’s mission ‘Force for Good’. Four winners were selected, all of whom have an outstanding track record and have demonstrated the highest levels of integrity.

Dr. Carole Ackermann was one of the winners of the not-for-profit category.  We recently had the opportunity to ask Carole about her illustrious board career and her advice for aspiring directors.

You have had a successful career working with a range of different organisations and with exposure to several disciplines.  What made you decide to take on board directorships?

Passion for all kinds of innovation and change, whether technological, organizational, culture or people – that’s driving me. I am a curious person; I like to be challenged and I love to work with people and in teams. As a board member and Sparring Partner for Management, I have the privilege to share my experience in different fields and help companies to embrace today’s world of technical, economic, and social complexity and ambiguity.

What are some of the key topics which your boards are focusing on in 2021?

Even though Covid-19 has changed the way we work together, the board still needs to dig deep into the companies matters, ask the tough questions, and help the CEO and executive board to find the “best” solutions and adequate measures.

Depending on the industry, the focus these days is more on costs, on organizational matters, or on innovation to catch up with new customer’s needs. Certainly, sustainability and digitization are important topics also in 2021.

Issues (Matters) I personally focus on are staying the strategic course with innovation, agility, and customer orientation combined with a strong, people-oriented corporate culture.

What areas do you focus on when you undertake due diligence on potential new board roles?

Currently, I am more than happy with my portfolio and I am not looking for new board assignments.

But looking back it’s the question – what can I contribute and what can I learn – this give and take balance. This, besides the obvious parameters such as the company’s reputation, its culture, its potential, its major challenges, its corporate governance, and finally the industry sector. As in any other job, to be successful as a board member, you really have to love what you’re doing.

But even if you did your due diligence, there is no such thing as the risk-free option. It is always about being attentive and making sure that you stay curious about new developments.

What are the areas which you believe that aspiring directors should focus on when starting their board career?

The first thing is getting to know the company and your new colleagues. Then it’s about listening and understanding what’s going on.

For sure, a new director needs a certain knowledge in the new area – that is important for the company and ideally, this is supported by emotional intelligence, experience and interest in the company and its people.

But rather than focusing on a special subject and trying to change everything from day one, I would use the privilege of being new to listen and watch first as from the best seat in the opera.

 

INSEAD Directors Network, IDN – An INSEAD Global Club of International Board Directors.
Our Mission is to foster excellent Corporate Governance through networking, communication and self-improvement. IDN has 1500 members from 80 countries, all Alumni from different INSEAD graduations as MBA, EMBA, GEMBA, and IDP-C. We meet in live IDN webinars and meet-ups arranged by our IDN Ambassadors based in 25 countries. Our IDN website holds valuable corporate governance knowledge in our IDN blog, and we share insights also to our LinkedIn and Twitter  followers. We highlight our member through quarterly sharing of their new board appointments and once a year we give out IDN Awards to prominent board accomplishments. We provide a peer-to-per mentoring and board vacancy service and we come together two times per year at the INSEAD Directors Forum arranged by ICGC. We also engage with ICGC on joint research.
About INSEAD Corporate Governance Centre.
Established in 2010, the INSEAD Corporate Governance Centre (ICGC) has been actively engaged in making a distinctive contribution to the knowledge and practice of corporate governance. The ICGC harnesses faculty expertise across multiple disciplines to teach and research on the challenges of boards of directors in an international context and to foster a global dialogue on governance issues with the ultimate goal to develop boards for high-performance governance. Visit ICGC website: https://www.insead.edu/centres/corporate-governance

32 board appointments for INSEAD Directors Network members

16 December 2020

Members Board & Corporate Governance Positions Announcement Q3 2020

INSEAD’s International Directors Network, IDN is proudly sharing the recent appointments of board and corporate governance positions of our members, truly recognising our members and the strength of our IDN network.

IDN members have been appointed to 32 new board positions in 20 countries, summing up to 325 position announcements since 2017.

As a member of IDN, the network of INSEAD International Board Directors, (full membership is open to all INSEAD Alumni with appropriate directorship experience and is automatic for Certified Directors (IDP-C) from INSEAD’s International Directors Program (IDP)), you can be truly proud of your network!

You will find the IDN members with new board positions below.  Why don’t you help share our network’s achievement via Linkedin, as well as also position yourself and your membership of a vibrant network via this Linkedin post.

And take the time to connect with your fellow IDN members at LinkedIn and expand your board contacts by clicking their names below and connecting with them!

To date, IDP has been completed by 1,378 IDP and IDPB participants, with 989 certified IDP-C/ IDBP-C directors, and our International Board Network IDN of INSEAD Alumni of 1,494 members.

IDN works closely with INSEAD Corporate Governance Centre, which undertakes cutting-edge research and teaching tailored to the needs of boards and international directors.  The Centre fosters a global dialogue on the challenges of corporate governance and leadership in an international context.

INSEAD Directors’ Network – Members New Board & Corporate Governance Positions

IDN members – Certified IDP-C Board Directors

Doris Albisser – June 2019 & 2020 – SOS Children’s Villages, Austria, International Senate (NED), Member of Audit Committee (Not-for-profit, HQ Austria) & International Senate (NED), Leadership Selection Committee
Abdullah AlMutrif – September 2020 – Board Member at FTG BVI Private, Saudi Arabia
Stefan Buser – July 2020 – Board member, IBC Insurance Broking and Consulting Zürich AG (Private, Switzerland) & Board member, Audit & Risk Committee of Netrics AG (Private Equity owned, Switzerland)
Alexandra De Mello – August 2020 – Board member, Beyond Social Services (Not-for profit, Singapore)
Hamza Didaraly – September 2020 – Chairman, INNOVDEAL Capital (Private, HQ France)
Dominique Eeman – January 2020 – Chairman of the Board – Akkanto Communications Consultancy (Private, HQ Belgium)
Giulia Fitzpatrick – Jul 2020 – Independent Non-executive Director & Vice Chair at Quintet Private Bank (Switzerland) AG (Private,  HQ Luxembourg)
Daniel Frutig– Meier – July 2020, Vice Chairman, Fondation Art-Therapie, Geneva, Switzerland (Not-for-profit, HQ Switzerland)
Ioannis Georgoulas – August 2020 – Non-executive director at FXCM EU ltd, Cyprus (Private, HQ USA New York)
Michael Hilb – July 2020 – Member of the Board of Directors at Sigvaris Holding Ltd. (Private, Switzerland) and  August 2020 – Vice-Chair of the Board of Trustees at the Foundation for Value Creation (NGO, Switzerland)
Nooraya Khan – August 2020 – Non- executive Board Director at Nampak Limited (Listed, HQ South Africa)
Adrian Moors – September 2020 – Non-Executive Director, 96 Capital (Private, HQ South Africa)
Helen Pitcher OBE – Committee member ESG in addition to NED and Chair of Remuneration C&C Group plc (Private, HQ Scotland)
Enrica Rimoldi – March 2020 – Non-Executive Board Director, Chairwoman of the Audit Committee, Remuneration Committee member and Nomination Committee member at UniCredit Bank of Slovenija d.d. (Non-Listed, HQ Slovenia), April 2020 – Independent statutory auditor  at Cordusio SIM SpA (non-listed, HQ Italy)
Mark Shuttleworth – September 2020 – Non-Executive Director, JT Group Limited (Private, HQ Channel Islands)
Natalia Strelkova – July 2020 – Independent board director and Head of HR Committee, BioVitrum (Private, HQ Russia)
Doris Tomanek – September 2020 – Chairwoman of Advisory Board, MOVEEFFECT GmbH (Private, HQ Austria)
Nicolas Trentesaux – June 2020 – Executive Board Member , Roquette Poland (Private, HQ Poland)
Krisja Vermeylen – September 2020 – Board of Directors & Chair of the Remuneration Committee, Diaverum (Private, HQ Sweden)
Helen Wiseman – September 2020 – Board Chair, Elixinol Global Ltd (Listed, HQ Australia)

IDN Members – Board Directors

Armand de Villoutreys – September 2020 – Board member, Groupe Pochet (Private, HQ France)
David Eurin – September 2020 – Board member, West Indian Ocean Cable Company (WIOCC) (Private, HQ Mauritius), shareholder representative for Liquid Telecommunications and member of the Remuneration and Nomination committee
Wu Gang – April 2019 Chairman, Risk Committee, Ashurst LLP (Private, HQ UK)
Zeina Hatem – September 2020 – Non-Executive Board Director at EcoHydra Technologies Ltd  (Private, HQ UK)
Malin Holmberg – July 2020 – Non-Executive Board Member at Storytel plc (Listed, HQ Sweden)
Pascal Ravery – May 2020 – Executive Board Member, JCL Logistics SA (Private, HQ Switzerland)
Regine Slagmulder – July 2020, Non-Executive Director at MDxHealth (Listed, HQ Belgium)
Tom Stephenson– June 2020 – CEO and Board Member – Wittur Group GmbH – Germany

Previous announcements and more information

Previous board position announcements by shared by IDN;
September 2020 March 2020 October 2019 July 2019  February 2019  November 2018 July 2018 April 2018  January 2018   October 2017

For organisations interested in partnering with IDN, please contact IDN President, Helen Pitcher OBE, at [email protected]

On Behalf of the INSEAD International Directors’ Network Board,


Helen Wiseman, 
IDP-C, IDN & NAA Australia Board Member,
NED at multiple companies
www.linkedin.com/in/helenwiseman
[email protected]

Getting your first board position

By Karen Loon, IDN Board Member and Non-Executive Director

What are the key actions that will increase the likelihood of getting your first board position?

INSEAD Directors Network (“IDN”) members recently had the opportunity to learn more about experiences and insights into the board recruitment process from four experienced IDN members:

in an exclusive webinar for members held on 1 December 2020 which was facilitated by IDN Board Member, Liselotte Engstam based in Sweden with Q&A support from Hagen Schweinitz, a fellow IDN Board Member based in Germany.

Participants heard from the panellists about their experiences getting their first board roles and growing their board portfolios.  They also had the opportunity to also to learn more about how an executive search firm can help directors.  Key advice by the panellists included:

  1. Invest in ongoing board education
  2. Have a clear vision on what roles make more sense to you
  3. Do thorough due diligence
  4. Build your board experience by collecting different facets of experience
  5. Don’t go it alone – find a mentor and a tribe to share and learn from
  6. Build your networks

Invest in ongoing board education

  • Continuous board education is important for all directors, even if you have had board roles as part of your executive career.
  • For international directors, consider both board education in your local market(s) as well as continuous education from programmes such as the INSEAD Directors’ Programme (“IDP”) and subsequently via the INSEAD Directors Network. The IDP programme provides participants with new perspectives including on the values and capabilities which they needed to act as independent directors and allows them gain greater perspective on the role of the board.
  • Keep your governance knowledge up to date but keep it practical and fit for purpose.

 Have a clear vision on what roles make sense to you

  • Do upfront research on what are the geographies, sectors and companies where you can and wish to best contribute. What is your unique selling proposition?  How many boards do you wish to be a director on?
  • Choose your targets by doing your research – what is the story behind the story i.e., what are they really grappling with at the boardroom table?  How might the current composition of the board be playing out?  Form a hypothesis and climb into the mind of the Chair.  What value do you bring both to the scenario and the different thinking styles and experiences of the board?
  • Get clear on your positioning so that people can easily remember you, build a networking plan (see below) based on the above research.
  • Prepare well for your interviews.
  • Collect your war stories for example from your executive, particularly crises requiring a collective with backbone to work through the issues, or influence across authorities – indicators of how you might perform on a board.

Due diligence

Be thorough on your due diligence on potential board roles.  Understand red flags and the culture of the organisation.

Build your board experience by collecting different facets of experience

  • Build your board experience by collecting different facets of experience to broaden your value offering for example industries, types of transactions/corporate actions, different stages in the life cycle etc.
  • Be willing to start on non-profit organisations and advisory boards.

Don’t go it alone – find a mentor and a tribe to share and learn from

  • Don’t go it alone, find a tribe to share experiences with and learn from (for example IDN, your local director association, Women on Boards).
  • Find a personal mentor (for example, a senior board director) who can help a new director to fine tune their communication styles for effective board decision making, taking into consideration personal values and styles. This will help you increase your confidence to look for further roles.  Consider joining IDN’s mentoring programme.

Networking externally and within your boards

  • Make yourself visible and able to be found. Ensure your LinkedIn bio is up to date.
  • Let people know that you want board roles (both your close contacts and more broadly).
  • Consider doing some public speaking at events or associations or industry specific events, writing a column in a publication or starting a business blog to position yourself as an expert worthy of being considered to sit on a board. IDN members may wish to volunteer to contribute to IDN’s regular blogs.
  • If you are not yet on a board, and still in an executive role, see if you can find opportunities to present in front of your current board to get familiar with the board rooms, dynamics, and structure.
  • Seek active endorsement and references from people who have seen you presenting and interacting in a boardroom.
  • Finally, if you are already on a board, don’t forget to focus on building strong personal relationships with your director peers and management.

IDN’s mentoring programme which is available exclusively for IDN members will be accepting applications in early 2021.  

 

INSEAD Directors Network, IDN – An INSEAD Global Club of International Board Directors.
Our Mission is to foster excellent Corporate Governance through networking, communication and self-improvement. IDN has 1500 members from 80 countries, all Alumni from different INSEAD graduations as MBA, EMBA, GEMBA, and IDP-C. We meet in live IDN webinars and meet-ups arranged by our IDN Ambassadors based in 25 countries. Our IDN website holds valuable corporate governance knowledge in our IDN blog, and we share insights also to our LinkedIn and Twitter  followers. We highlight our member through quarterly sharing of their new board appointments and once a year we give out IDN Awards to prominent board accomplishments. We provide a peer-to-per mentoring and board vacancy service and we come together two times per year at the INSEAD Directors Forum arranged by ICGC. We also engage with ICGC on joint research.
About INSEAD Corporate Governance Centre.
Established in 2010, the INSEAD Corporate Governance Centre (ICGC) has been actively engaged in making a distinctive contribution to the knowledge and practice of corporate governance. The ICGC harnesses faculty expertise across multiple disciplines to teach and research on the challenges of boards of directors in an international context and to foster a global dialogue on governance issues with the ultimate goal to develop boards for high-performance governance. Visit ICGC website: https://www.insead.edu/centres/corporate-governance

Cognitive Biases on the board & Corporate Climate Change Inertia

By Pamela Ravasio, IDP-C and IDN Board Member

The influence of decision bias is nothing new when scrutinizing corporate governance. For good reason a not insignificant amount of time during INSEAD’s International Directors Programme (IDP) is spent looking into decision biases as well as learning about how to remedy them in the board context.

Further, we all are aware: The consensus that climate change is having already huge consequences not just for the planet but also on corporate operations, risk profiles and profits. And yet: by and large businesses continue to fail to adjust their strategic decision-making processes to become more climate viable. At best they have just barely started on their journey.

Why is that? As we look deeper into the corporate discourse on Climate Change, it becomes evident that one of the silent yet crucial culprits behind the climate change inertia lies in the cognitive biases at play in corporate decision making.

A recap on decision biases: What is it, and what types exist?

There exist a plethora of cognitive biases recognised in psychology and decision making theory. Only a subset however seems to be of practical relevance for the decision process on boards. Some of the most frequently encountered biases in this context are the Anchor Bias, the Loss-Aversion Bias, or Availability Bias – all of which are being looked into during the IDP.

Equally drawing from the IDP: A good part of the Fair Leadership Process is also intended to neutralise such decision biases, or at the very least to make them explicit and challengeable.

Decision Bias and ESG: Cause and Effect

A 2017 California Management Review article found that in the context of corporate decision processes related to Climate Change – notably on boards – four bias types are of particular relevance: Framing Bias, Optimism Bias, Relevance Bias, and Volition Biases.

What are those biases, what do they mean for boards in the context of strategic Climate Change decisions, and what can be done about it?

Bias 1: Framing Bias:

  • Definition: “Framing bias occurs when people make a decision based on the way the information is presented, as opposed to just on the facts themselves. The same facts presented in two different ways can lead to people making different judgments or decisions.” (Source)
  • Board decision impact: Already framing the issue for example as ‘Climate Change’ rather than ‘Global Warming’ or ‘Climate Emergency’ disguises the urgency with which actions are needed, as well as the extremely tight timelines, and concentrated actions and investments needed. Framing is often decisive in identifying how urgent, critical, and bottom line relevant an issue is.
  • What to do about it? Language matters. Choosing wording carefully is a good start. Spelling out underlying assumptions is another good way to get to a more realistic picture of reality.

Bias 2: Optimism Bias:

  • Definition: People tend to overestimate the probability of positive events and underestimate the probability of negative events happening to them in the future. (Source)
  • Board decision impact: An example of the optimism bias in action is the assumption that advances in technology and innovation will allow us to revert Climate Change at a later date. Through such assumptions, responsibility is shifted away from the current context, and leads to inaction in the present.
  • What to do about it: Brutal honesty is necessary – and some significant efforts around spelling out what worst case scenarios could and would look like. Can a company successfully survive a worst case? And how exactly?

Bias 3: Relevance Bias:

  • Definition: Our subjective understanding of how important and critical an issue truly is, based on what we know or think to know. (Source)
  • Board decision impact: An example of this bias in action is that we all know that temperatures will rise between 2 and 5 degrees Celsius still this century. And yet – subjectively those temperature rises seem to be inconsequential. The reason being that as human beings – and as a consequence also in the professional roles we embody – we are already primed to ignore it.
  • What to do about it: Investigate how the information is anchored. For example in the above case, a 2 degrees temperature rise would be perceived through a subjective lens and set of experiences. Next, work on replacing those subjective views through a more objective, data driven but equally tangible (experiential, pictorial) description of the same, with the intent to replace the subjective experiences through those rooted in objective knowledge.

Bias 4: Volition Biases:

  • Definition: Broadly, these are errors in judgement that result from deferring responsibility (‘it is not my problem’), and can come in many forms such as through deference to authority or the ‘others do it as well effect’. (Source)
  • Board decision impact: Being reluctant to act because of an absence of a legal enshrined ‘level playing field’ is one of the most frequently cited versions of a Volition Bias. Another example is when companies finger point other players in their industry, say for not paying a living wage, and in this way justify their own behaviour and inaction.
  • What to do about it: Ask the question “What should the company (the board, the individual) do if the responsibility for change was theirs, and theirs alone?”

Conclusion

Climate Change “is the predominant moral issue of the 21st Century” (James Hansen, NASA climatologist). And yet, a recent survey shows that only 17% of Board of Directors serving on Sustainability committees have sustainability expertise. (Source, page 12).

Hence, while we’re waiting for boards to get their sustainability literacy up to speed and at a level comparable to their financial literacy: taking concrete measures to recognise, and remedy existing cognitive biases and their impact on decisions related to Climate Change action, is an effective, reasonably simple to grasp and implement, low hanging fruit that no doubt bears a considerable harvest.

 

Chairman of the Future: Diversity at the Top

By Helen Pitcher OBE, IDP-C, President of INSEAD Directors Network, Experienced Chairman, NED and Board Committee Chair

The sustainability of companies and businesses to contribute and benefit all of their stakeholders, is increasingly at the forefront of the minds of Politicians, Regulators, Society Pressure groups and Individuals.

Business of the future

The journey of Boards over the last 10 years towards greater diversity has seen a significant shift and we are starting to see the benefits of these more diverse Boards performing effectively in response to a wide range of challenges.  However, we also need to focus more fully on the diversity drive for the Chairman role, both to reflect these recent diversity gains on our Boards and to provide Leadership and a catalyst for increased change and action from our Boards.  It is time to stop the wastage of talent and get on with the job of facilitating women to achieve the top roles in our companies, we cannot afford to ignore 40% of the potential candidates.

The skills of chairman

The research from INSEAD suggests that there is very slow progress in this area, in the UK for example, if we do nothing, it will take until 2027 to achieve 20% of women as Chairman of our Boards (INSEAD Research by Professor Stanislav Shekshnia).  We need to accelerate the pace of change and ‘skip’ a male generation to drive the appointment of female Chairman more quickly and beyond that 20%.

As you look at the skills and expertise required to be an effective Chairman- the evidence for what makes an effective Chairman is very clear.  The skills that emerge as critical and defining are; an ability to influence others without dominating, having an engaged vision of the future, strong emotional intelligence and coaching skills. These Behavioural-Emotional skills are to the fore are with, the ability to build trust upon which people can rely.

“To be effective, Chairman must recognize that they are not commanders but facilitators. Their role is to create the conditions under which the Board can have productive group discussions. They should recognize that they are not first among equals. They are just the person responsible for making everyone on their board a good director.” (Professor Stanislav Shekshnia INSEAD-Leading from The Chair Programme).

Why do we need to accelerate the pace of change?

Without intervention the progress to women in the Chairman role is too slow; the target should be to get to 35% by 2025 and 50% by 2027.  While the general diversity debate has moved on, advancements towards Women Chairman are pitiful, with still too many active resistors, Headhunters, Chairman, Nominations Committees, and perpetuating stereotypes that you need 10 years Board experience to be considered.

More Women in the Chairman role can help rebuild the trust in our companies and build businesses that deliver business performance combined with social and environmental benefits, leading to greater sustainability in our society.  The social case for women Chairman is clear, ranging from societal benefits, to greater empowerment and inclusion of women, visible role models, as well as access to a broader talent pool and range of diverse skills.

There is a growing and enthusiastic enclave of advocates for the acceleration of progression of Women into the Chairman role across many influential groups, however there is still an inertia of action.  Consequently, in the UK we have started the ‘Diversity at the Top’ initiative as an advocacy group to focus on this Female Chairman issue.

Blockers to progress

Women themselves will also need to bolster their resolve, expressing the ambition to be Chairman and reducing their self-limiting belief that it is beyond their grasp.  They need to overcome the mind-set which causes them to seek to ‘over-qualify’ and be ‘over-capable’ before targeting themselves at the role.

Educating Nominations Committee members in how to formulate gender neutral job and person specifications is key, along with conducting a detailed skills audit of the Board with Diversity as a core dimension. This is best practice, but not universally applied.

Also, a shift needs to be made in the Recruitment-Development processes, moving from a stereotypical view of the Chairman role profile, towards a more creative resourcing, on-boarding and mentoring support process developing more appropriate role models.

There needs to be more active sponsorship and development of women at the Board level to engage with development for the Chairman role.  This needs to go beyond the typical Big Four Information sessions on Audit/Risk/Cyber/Governance, into a more creative development framework of Board level development. This will require women to step beyond the existing Board for their development, recognising that many Boards already have limited time allocated to develop knowledge and the interpersonal dynamics within the Boardroom.

We need to increase our ambition and pace of change; it is time to drive practical and direct action to accelerate the acquisition of more female Chairman right across our companies.

It is time to push through this current psychological log jam and actively discuss the facilitative and revolutionary evolution to remove this limiting mental model and stereotype of a Chairman.  There will need to be a concerted effort from Headhunters, Chairman, the media and the other wide range of interested groups to draw on available mentors and sponsors as well as to challenge thinking and make this happen.

As a practical step in the UK the ‘Diversity at the Top Initiative’ gathered together a group of likeminded people from a range of backgrounds who are committed to increasing the number of Female Chairman, as an exemplar of Board performance and a beacon for the diversity of their Executive pipelines.  This group has focused on ‘The Future of Woman Chairman’, over a series of meetings and discussions, and provided a spotlight on the issues and more importantly the potential solutions to this logjam.

A summary of their deliberations and Action Plan, identifying the most important areas to highlight to ‘move the dial’ can be accessed at here.

 

 

Boards and Sustainability: From Aspiration to Action

Boards of directors can play a critical role in determining how much attention their firms pay to sustainability.

In this article, Craig Smith, INSEAD Chaired Professor of Ethics & Social Responsibility and Ron Soonieus, INSEAD Executive in Residence and Chairman of the Dutch NAA Sustainability Club explain how boards can turn their aspirations for sustainability into meaningful action, particularly in light of the fundamental questions boards should be asking in the wake of the COVID-19 pandemic.

From the authors:

“This article is our most elaborative on the subject to date. It includes a fresh take on our “Five Archetypes of Board Sustainability Behaviour”, new insights, recommendations, and our view on how COVID-19 changed nothing (and everything) for boards.”

First published by Management and Business Review.  To read the full article click here.

Synopsis

Boards of directors are vital to firms taking substan­tive action on sustainability. While prior research has suggested that boards pay little attention to the topic, a recent survey by Board Agenda suggests that many individual board members have ambitious aspi­rations for sustainability. Unfortunately, respondents also feel that their companies lack the people, knowl­edge, and tools to take action. We interviewed twen­ty-five directors from the boards of well-known firms, examining the obstacles to greater board engagement with sustainability, including board members’ charac­teristics. In analyzing interview responses, we found five distinct archetypes of board member behavior. These profiles help explain the divergence between the attitudes of board members toward sustainability and the frequently inadequate action of the board as a whole. Our findings suggest ways to motivate each type of board member and the value of auditing the knowledge and mindset of board members toward sus­tainability, offering six approaches to strengthening board engagement with sustainability. While the eco­nomic effects of the COVID-19 pandemic might appear to reduce businesses’ ability to become more sustain­able, we believe the wise course is to focus on the longer-term trend toward meaningful action. We are con­fident that many board members will agree.

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Confronting Governance Conundrums in an Era of Change

How have the role and focus areas of boards been evolving as the corporate landscape has changed? 

By Karen Loon, IDN Board Member and Non-Executive Director

On 16 October 2020, a diverse panel led by Helen Pitcher OBE, IDN President discussed “Confronting Governance Conundrums in an Era of Change” in a session held as part of the INSEAD Directors Forum.  Panellists included:

  • François Bouvard, Vice Chair of Institut Français des Administrateurs & NED
  • Karina Litvack, Non-Executive Board Director, ENI S.p.A., Executive Board Director, Chapter Zero, Member of Board of Governors, CFA Institute, Non-Executive Director, BSR
  • Elena Pisonero, Chairperson of Taldig and former President of Hispasat, former Spain’s Ambassador to the OECD; former Secretary of State of Trade, Tourism and SMEs in Spain

The panellists discussed a wide range of topics including:

  • What COVID has meant for boards
  • Digitisation and data
  • Changes in corporate governance in the future
  • How will the role of directors change in the future?

 What COVID has meant for boards

Over the past nine months, COVID has significantly changed our world.  Whilst some companies anticipated some of the changes, others were less prepared for them.  For many companies, it has created an acid test for workforces, management and boards who face big challenges ahead.  As management may not have enough time to focus on strategy and “reset”, there may need to be a big shift in the roles of management and boards.

The acceleration of change has also brought to the forefront companies which were less or more prepared due to their digital structures.  Those companies which identified the transition of change in society prior to COVID have been transitioning this fairly well compared to sectors which are struggling because they are still doing business in more traditional ways.  COVID has emphasised the need for boards and management to work more closely together to identify the future needs of stakeholders at large, not just shareholders.

The pandemic is an example of a systemic risk – something that none of us can solve because it needs to be solved at a systemic level, but all of us suffer the consequences of if it’s poorly managed, therefore, what are we going to do?  In considering the systemic impact of the pandemic, a broader question some companies have been considering is do boards understand systemic risk, do they talk about it, do they discuss it?  What can they do as companies to influence systemic preparedness, and is there a role for business in influencing the policy environment and the big social infrastructure investments that are made to protect both the society and business environment?

Some panellists feel that it is time for companies, led by their boards to introduce more ‘out of the box’ thinking and change the role of governance.  Boards and companies should not only be considering what they can control but think more broadly about all the things that are going on.

Digitisation and Data

Many companies have a misconception or misunderstanding of what digital is – it is what we can do with connectivity but doing things in a different way. Digital technology is the tool which allows companies to better reach their purpose.

Increasing the extent of use of digital should be viewed as a cultural change; it is not a matter of introducing new processes or new titles for the C-Suite.  It is how companies combine digital and physical means.  Companies need to have a mindset change and consider their whole value chain and how they can better manage and identify best opportunities to change their business models in order to thrive.  Companies cannot succeed at affecting this transformation unless they put people at the centre of it.

One suggestion was that in order to be better prepared for more digitalisation, companies should introduce ‘D’ in ESG because we should introduce as much data as we can to improve our decision-making processes.  Data is a crucial part of a digital mindset to improve decision making and identify and anticipate future risks.

Changes in corporate governance in the future

Boards are now looking at how they govern their companies more holistically, shifting discussion towards stakeholder governance rather than just shareholder capitalism.  Many companies are starting to address human issues (i.e. talent development) more effectively and are connecting the dots in terms of digital to human elements, recognising that at the end of the day that key stakeholders are customers and employees.  Digital has been providing companies ways to be more efficient.

Whilst sustainability is more on the mind of everyone, many companies are struggling with shorter term issues, so have pushed some longer-term questions aside for the moment.  This will continue if the pandemic drags on.  However, boards and management do need to revisit the way they work together on strategy in the longer term.  Whilst in the short term, companies may have lost focus on sustainability, in the longer term the view is there needs to be much more focus on this area as companies have a societal responsibility and everything they do should link back to the organisational purpose.

It is likely that the amount of time which boards spend focusing on more “out of the box” discussions in the longer term will expand, given that CEOs and management teams are required to spend much more time on shorter term issues.

How will the role of directors change in the future?

As the whole landscape changes, directors will also need to change.  This should start with the board of directors.  To be on top of all the issues, not only do they need to be open, read a lot and network well, they need to continue to improve their soft skills to be able to support their CEOs and teams in a supportive and yet challenging way.  Boards need to increasingly take a holistic view of their stakeholders, as well as how they support the development of talent, and how they use digital and data.  There is also likely to be much more interaction between boards and management, often digitally.