A Path to the Top Table: Defining the Future, Now
COVID-19 has brought into sharp relief the expanded role that boards of directors are taking to support management and add value to an organisation in difficult times. While there is no one-size-fits-all answer for what a board should do in these unprecedented times, a McKinsey article looking at the role of boards during and beyond the pandemic, notes: “A board can ease the pressure on the management team by reviewing communication plans and reputation management challenges and engaging with select external stakeholders.” Helping management with operational communications is not a traditional function of the board. However, these are not normal times and COVID-19 is creating new normals for companies every day even as they emerge from lockdowns.
Even prior to the pandemic, Heidrick & Struggles noted the opportunity for the typical board to evolve in its Board Monitor Hong Kong 2019: “Nominating committees might consider executives in traditionally untapped functional areas,” pointing to PR and communications as a focus area. It could be argued that a company’s own Chief Communications Officer (CCO) is sufficient or boards should turn to external consultants for advice. But as Deloitte discusses in Stepping in: The Board’s Role in the COVID-19 Crisis, the current crisis may permanently change how many businesses operate, bringing implications for the purpose and overall positioning of the organisation. Proactively managing reputation with purpose-driven communications is instrumental to survival and success.
Diversifying board composition
So how well are the boards of today equipped to step in and step up in times like these?
There has long been a push from investors urging boards to look beyond CEOs and experienced directors to find boardroom talent. The National Association of Corporate Directors and Partners’ 2020 Governance Outlook: Projections on Merging Board Issues analysed the S&P 500 and found that positive headway is being made on the value of functional and other corporate leadership, with an increase of new directors in 2019 coming from outside top executive ranks of CEO, COO, and others.
However, SpencerStuart’s analysis of Chief Communications Officers in the Boardroom suggests that still very few Chief Communication Officers (CCOs) currently serve on corporate boards (just 16 board directors on Fortune 500 boards in 2018 had also held the most senior comms role).
While diversification of experience is important, gender diversity and racial and ethnic diversity are rightfully clear boardroom recruitment priorities. And research suggests that demographic and skillset considerations don’t necessarily exist in siloes. The NACD 2020 Governance Outlook report highlights that with a greater focus on diversification of the board, comes a natural evolution of the skillsets and expertise in the boardroom: “Women and minority directors are one of the driving forces behind the changing profile of new S&P 500 directors, enhancing the diversity of thought, experience, and expertise in many boardrooms.
If this pandemic has taught us anything it’s that there is no business as usual. The rules of the game have changed and corporations need to continue to bend, flex, and evolve like never before. An agile agenda needs to be led from the top, and this starts with the scrutiny of board composition and breaking down ‘this is how it’s always been done’ walls.
Emerging from this crisis, boards should consider ways to optimise the annual evaluation process. Assessing the skillsets, culture and dynamics of their boardroom, forward-looking boards must go beyond a compliance-driven exercise and complete a more thorough post-mortem. Critically examining the relevancy of current director skills and profiles; expectations and rules around tenure length; and priorities around diversification are key to accelerating change and enhancing resilience.
How more communications leaders can land a board room seat
With so few boardroom seats available each year and a growing trend for smaller size boards further challenging the drive for wider board diversity, how can more comms leaders get a seat at the table?
As SpencerStuart highlights: “A talented CCO can manage and influence media; interpret and evaluate market feedback; capitalise on new opportunities; deftly manage crises; calm nervous investors; and build bridges with policymakers.” Despite historically being viewed as a “softer skill” and less crucial to a board mandate than say finance or legal expertise, the field of communications is critical in preserving and growing reputation and market value in volatile environments.
While boards increasingly need to think more about reputational risk and having boardroom expertise to lead that agenda, communication leaders can simultaneously be improving their board chances with the following considerations:
Expand your network. Relationships and networks matter when it comes to finding a board role. Surveys find that a significant majority of directors were introduced by someone who is already on the board or in a senior role at the company. Whether this informal approach to filling sought-after board seats will change as more companies directly address the diversification of demographics and skillsets is yet to be seen, but taking proactive steps to develop professional relationships with members of the board(s) you are interested in joining may increase your chances of being considered.
Expand your horizons. While your sights may be set on corporate board directorship, consider building your experience and connections with a seat at smaller private companies or non-profit organisations first. Many nonprofits are experiencing incredibly challenging times amidst the pandemic and having a CCO on the board who can help pivot the proposition of the organisation and support fundraising efforts would be invaluable.
Expand your strategic expertise. Boards need executives who will add value based on the company’s strategies and risks, but communications experience alone will rarely be enough to secure a boardroom seat. Strong business acumen and high-level leadership will make you a more viable choice. Seek out wider business and governance opportunities to strengthen your expertise beyond your functional role.
Expand your education. While formal training isn’t mandatory to become a board director, it can help elevate your understanding of financial, behavioural, and governance issues shaping the boardroom. I recently completed a Financial Times Non-Executive Director (NED) Diploma which was incredibly rewarding, and it affirmed for me that if there is ever a time that boards should be equipped to help management communicate more effectively it is now.