In my last article, I wrote about why people who want a board appointment spend too much time articulating why they think that they should be appointed to a board and that they don’t spend enough time considering what the motivations are for the Chair (the ultimate decision-maker).
Regardless of the scope or scale of your target organisation, there are just 5 core elements that a Chair wants to find in a new NED. Today I want to define what they are.
There are literally thousands of boards operating across a wide range of industries in Australia and internationally. Each one operates within its own context and has various peculiarities unique to them as such, it often seems difficult to decipher exactly what they might value in a new board member. This confusion is often compounded by a board’s desire to have specific and targeted skills which regularly change to match the organisation’s current circumstances and aspirations. All of which means many are confused about what their to board pitch should be and how to powerfully articulate their value at board level.
I have been putting people on board for over a decade and in that time have taken briefs from hundreds of Chairs who were looking for new NEDs. After stripping away the contextual issues, in my experience, there are five core criteria that you must be able to address verbally and in writing in both formal and informal contexts. The combined value of these elements will result in your Board Profile and will answer the question you will be asked by Chairs, recruiters or Nominations Committees ‘Why should we appoint you to this board’. The summation of these elements will go some way to making you the perfect board candidate. Those five core criteria are :
1. Prior Governance Experience
‘The best way to demonstrate future success is past success’ – an old adage many adhere to because it rings true. Of course, when you think about it, it is misleading because it doesn’t take into consideration a wide range of personal or professional elements. I have seen clients on numerous occasions make seemingly strong appointments of a ‘successful’ candidate only to see these individuals fail or not live up to expectation. What is the reason for this? Because they thought past success was equal to future success but they did not take into consideration the many factors which influenced that success. For example, they may not have considered the differences in the culture of the organisations, the teams supporting them, their family life at the time, the economic environment, etc. However and despite many boards overemphasizing the value of past governance experience, it is still something that most appointment processes take the most comfort from. Indeed it is the thing that Chairs ask for first – someone who has done the role before. I understand this, few want to go through the process of training a new NED and would much prefer to appoint one who will hit the ground running. For this reason, being able to demonstrate some form of governance experience – board or committee experience – is really valuable when applying for a board role.
So if you have had governance experience – that is having sat on or worked with boards before this should be where your emphasis should be initially. Tell them you have done the job before, make it clear you understand the roles, responsibilities and how board interactions work.
At this point, I should state that if you do not have board or governance experience it does not mean you can’t get a board appointment – everyone must start somewhere. If this is you, you should try to orchestrate some governance experience. That may mean committee work, evidence of reporting into boards, a small not for profit appointment perhaps or, and this is critical, how your skills are useful in a board context. Which leads us nicely into the 2nd element a Chair is looking for.
2. An Executive Skill Set
What is your value at board level? Why do your skills matter in this context and why are they more valuable than one of your competitors with the same skills? These are the questions you must be able to answer clearly and effectively. Being unclear about this is a killer. I recently interviewed a potential board member who, whilst well qualified and had relevant experience, could not articulate what their role on the board would be. Needless to say, he was not appointed. So, be clear about what you have to offer and ensure that you can articulate it.
Finance, audit and risk and legal are the most often requested skills at board level – so that is great news for the lawyers and accountants reading this article. However, it is not a slam dunk. You will be competing against other lawyers and accountants for the roles you want so you must be able to articulate why your skills are more valuable than theirs. And, for those of us who aren’t accountants or lawyers we need to work hard to articulate what our value is at board level.
Regardless of your skills, you must be able to articulate your success at board level. Perhaps the best way for you to think about doing this is considering how your skills mitigate risk at board level. Ask (and answer) the question ‘what would happen to the organisations if it did not have my skills on the board?’. There are plenty of high profile examples of where organisations have opened themselves up to unnecessary risk by not having the right skills represented on the board – think VW for example.
3. Personal Connections
Many organisations with boards don’t need much governance experience or even particular skills represented. Instead, what they really want are your personal connections. As such, demonstrating how your ‘Personal Connections’ (otherwise known as ‘networks’ which Malcolm Gladwell in his book”The Tipping Point” helpfully reframes) can benefit the board/organisation is key. This will mean spending time thinking about who you know (individuals, industry or organisations), how they could help and how valuable they might be in a board context. No matter what you call them, the point is that boards want the benefit of your personal connections because the introductions you provide can, amongst other things, expedite business growth and lead to new opportunities. The value of your personal connections should not be underestimated and they offer more to an organisation than you might imagine. In the end, this is a key part of your unique selling point (USP) and an important reason people get appointed to boards.
4. Demonstrable Passion
Finally, one always has to remember that passion is the key to being able to effectively serve on a board. Current board members are passionate. They are passionate about one of three things. 1. What the organisations does 2. What the organisation is or 3. How they can contribute. You must be able to share these passions – and be able to articulate them. As such, your passion must be demonstrable. In many cases, this passion can be manufactured. Simply engaging in a real way with the organisation and sector will allow you to do this. However, it will be difficult to do this convincingly if you don’t start that journey early. But, demonstrating your passion for the organisation is essential and not being able to do so can often be the difference between an appointment or not.
5. Cultural Fit
Cultural fit is a difficult one to define. In many ways, it is a catch-all of the four points above. However, it is also more than that. Cultural fit is one of the reasons that people are appointed via personal connections so often. In essence, being a good cultural fit means that you are going to work appropriately with the board and as such do not offer a risk to those appointing you. It is a powerful attribute and one many candidates overlook in their preparation for interviews or informal conversations with Chairs. Essentially, what cultural fit means for a Chair is that you are not going to risk their reputation and that of the organisation they represent if they were to appoint you. So, to respond to this element you must be able to articulate your knowledge and engagement of the industry, knowledge of the business, reference people you know in common and, you must reference people you know in common. This might sound like a tall order but it is surprisingly easy to generate a strong cultural fit – something we do with our NED Program members and we teach in our Training Modules.
Ok, lots of content here so, to put all of this into more familiar context the five criteria that boards look for in potential board appointees are not dissimilar from what you might expect in an executive appointment:
- Governance Experience: Someone who has done the job successfully before.
- Skills: Someone who is qualified and capable of doing the role that is asked of them.
- Connections: Someone who knows the sector and is connected well enough to bring additional value to the business.
- Passion: Someone who really wants to see the business grow because they are passionate about what they do.
- Culture: Someone who is going to fit into the culture of the team and/or organisation.
There is, of course, no such thing as a perfect board candidate and there are countless reasons why you might not be appointed to a board. However, understanding what the ‘appointment levers’ are means that you can begin to address them and thereby increase your chance of successfully being appointed to a board.
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About the Author
David Schwarz is CEO & Founder of Board Direction – Australia’s leading board advertising and non-executive career support firm. He has over a decade of experience of putting people on boards as an international headhunter and a non-executive recruiter and has interviewed over one thousand non-executives and placed hundreds into some of the most significant public, private and NFP roles in the world
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