The most successful boards I have seen are comprised of individuals that bring diverse experiences and perspectives for the benefit of those that they serve. They understand the collective skills required for the board and how the individuals each contribute to that collective strength. They are also aware of how those board skills evolve over time, both consciously through strategic initiatives and naturally through changing conditions in the broader operating environment.
There are a number of factors that enable diversity, with some obvious ones being gender and ethnicity, and some less obvious ones, such as diverse experience across industries and sectors. A challenge is balancing the need for diversity with the need to have a manageable number of directors. After all, there is a point where not every experience and perspective could be represented by appointing another Director!
A way I have found useful for boards to build and maintain balance and diversity is to look at a process that:
- articulates the skills needed to achieve identified strategic initiatives
- reflects on the current and future issues facing the organisation, and the skills required to address them effectively
- clearly articulates who the board is in service to, such as shareholders in a corporate board compared to members in a not for profit board
- decide on those skills that the board requires, as distinct from management, and prioritise which are required immediately compared to those needed in the longer term
- map existing skills against those identified to determine what, if any, gaps need to be addressed
Importantly, this is not a static process and requires ongoing attention and effort to ensure continued appropriateness in a constantly changing world. It is also an incredibly useful way of building a pool of suitable future Directors in a considered manner. I have come across some very talented individuals who are looking at joining boards or subcommittees. Knowing which board is best placed to leverage those skills is increasingly difficult if boards aren’t clear on what they are looking for now and in the future.
To find out more, come along to my ‘Building and maintaining a balanced board’ workshop, with details below.