Executive coach and strategic advisor Amii Barnard-Bahn provides guidance on how executives can prepare for a board appointment: Start by following the 10 steps outlined here.
A lifelong diversity advocate, I testified in multiple legislative committees on the successful passage of California’s SB826, the first law in the U.S. requiring corporate boards to include women. This legislation was designed to create more access for diverse and qualified candidates for public boards. “More access” is important because the role of the board has become critical to the long-term health of a company and the protection of its shareholders and employees. Creating a larger pool of seasoned professionals to guide and govern our corporate institutions is paramount in a time of Tesla, Papa John’s, Theranos and CBS debacles.
A board search can take many years, so it’s never too early to evaluate and cultivate the skills and network you need to establish yourself as a viable candidate.
If you are a seasoned business professional ready to take on the responsibility of being an active member of a board, here are some things to note:
- Take your time and research the company and team to make sure it’s a good fit.
- In a well-designed board, each member contributes different skills and experience, which creates a powerful combination that helps to drive company success. Boards generally seek specific experience criteria such as finance, business development, technology, international, operations, legal/public policy, risk management and knowledge valuable to the specific industry, competitive market or geography of the business. Evaluate your experience and unique contributions, and tailor your search to companies that can best use your skills.
- Directors are fiduciaries, meaning they are obligated to exercise their corporate powers as trustees for the benefit of the shareholders/owners of the corporation. When you join a board, you are taking on significant responsibilities to shareholders, employees and the public.
- Your board success depends on how well you get along with others and how well you know yourself. Working with a trained executive coach who can assess your core competencies and gauge leadership effectiveness can bring an increased awareness of strengths and development opportunities.
Top 10 Essential Steps Before You Join a Board
1. Meet each board member personally. Test the collegiality; inquire about board dynamics. Do you feel welcome? Do you like and respect each of them? Experience – do they serve on other company boards? Check governance ratings from organizations such as Institutional Shareholder Services to evaluate board strength.
2. Meet each C-suite executive and assess their strengths and weaknesses.
3. Understand how the company makes money and how they conduct business. What’s their approach to risk, and what is your comfort level?
4. Review company finances with an outside CPA, and confirm D&O insurance.
5. Meet the general counsel to review pending litigation.
6. Know the top risk areas and how each is managed, especially in highly regulated industries. It’s important to confirm the company is effectively paying attention to their risks.
7. Fully understand board compensation and stock holdings/liquidation requirements and whether a cash/equity investment is required of you.
8. Ensure you fully understand and can attend all board meetings.
9. Disclose and vet any perceived or actual conflicts of interest with an attorney.
10. Confirm the unique value/skills you are expected to contribute.
This article was originally shared on LinkedIn and is republished here with the author’s permission.