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Many senior leaders want to believe they could be superior independent directors because of their experience, expertise and accomplishments. Unfortunately, only a small percentage are boardroom ready or, dare I say, boardroom worthy.
A strong board of directors is a powerful strategic asset for a company. At the core of a collegial, well-functioning independent board are trust, respect, open debate and healthy communications.
What independent means
A frequent question I hear is, “What qualifies a board member as independent?” My answer is that the candidate:
- Has no political agenda.
- Isn’t a “yes man” or “yes woman” but respects others.
- Has never been in the same social circle as the directors or owners where any type of leverage could be used, as in, “I saw you drunk at the country club Christmas party.”
- Isn’t a personal friend but is friendly.
- Has no business relationships with the company (customers, suppliers, consultants, bankers, lawyers, accountants, etc.).
- Has no family connection.
- Is fact-based and direct.
- Isn’t emotional and has no hidden agenda.
Executives with high emotional intelligence excel in a boardroom. These transformational leaders inspire and influence others by creating trust through effective communication.
They must rely on their wisdom and excellent judgment. These attributes typically come from people with gray hair. They have experienced many challenges, overcome adversity and have many successes to prove it. Experience is often thought to be the key criteria for a board member.
The traditional “balanced board” would consist of senior leaders who, now or in the past, were responsible for tactics and strategies in multiple areas such as sales/marketing, finance, operations or technology. More recently, there’s been a high demand for top executive talent in areas such as digital transformation, cybersecurity, human capital management and sustainability.
How to find the perfect independent member
The average age and years of experience of board members is likely to decline and may result in companies appointing younger leaders to their corporate boards. That’s because there will be a new generation of leaders and the search for a broader set of director skills.
Although having these diverse skill sets in the boardroom is important to good strategic planning and corporate oversight, don’t overlook the soft skills and emotional intelligence as the real differentiators.
These six characteristics and behaviors in executives are essential when recruiting independent board members:
- Character - Are their actions on target, respected and remembered? This is often referred to as “the impact factor.”
- Integrity - This means adhering to a strict steadfast moral code with unimpaired judgment and behavior. Can you trust them to do the right thing and meet high ethical standards?
- Success - Look for people who have a consistent track record of success in their personal and professional lives. Are they highly motivated, highly productive and do they love a challenge? Are they outstanding in what they do?
- Servant leadership - They make sure that accountable teams have the authority and resources to achieve the company’s commitments. Do they build and maintain positive relationships by serving others? Are they effective mentors or sounding boards?
- A killer instinct - This means being able to make correct and tough decisions with the minimum amount of information, in the shortest amount of time. Are they able to control their emotions and be decisive?
- Collegial - Do they share equal consideration, power or authority with their peers while being direct, independent and focused communicators? Are they capable of understanding other viewpoints and challenging them respectfully with intelligent questions?
A well-functioning board has people with all of those qualities. A special chemistry or unique boardroom dynamic often reflects the values of the corporation and directors. Those characteristics build on one another.
Board members develop mutual respect, which leads to trust. They can digest information more quickly and make tough, timely decisions. Those six characteristics easily result in the most valuable and productive independent directors.