RESHAPE YOUR DIRECTORATE

Skills and talents need to transform – Ralph Ward and Dr. Muneer Muhamed

‘The Young Directors’ sounds like a great OTT pulp series on Netflix. But for board members in their 30s (and even 20s), the experience is less glamorous and more challenging than imagined.

Gen Y and Z populations are growing in many workplaces. In Sri Lanka, men in the age group of 35 to 39 constitute 90 percent of the male workforce and women between 25 and 29 years of age comprise 46 percent of the female contingent. Globally, people between the ages of 20 and 40 comprise half the workforce, according to the World Economic Forum.

The average age of an S&P 500 board member is 63 however, and more than half these boards have no members under the age of 50. A Spencer Stuart survey found that the average global boardroom age ranges between the late 50s and early 60s.

While continued efforts to reduce the gender gap and increase diversity in boardrooms are displaying results, they still focus on the few older prospects who battled their way up the corporate ladder.

Not only are these grey-haired folks ‘overboarded’ but they’re also not making way for younger, more diverse professionals who could make a significant difference in the unpredictable era of technology.

These candidates and other younger directors bring immediate hands-on skills in data analysis, AI, marketing, finan-ce and global changes that are reshaping every business.

Now that you know how young board members can contribute to the agility required for the new-age economy, how do you find them? Also, how do you benefit from their skills and help them to fit in?

Begin by reshaping your board structure to encourage diverse age representation. Do you have board age or tenure limits? While the former is common, the latter remains rare; and yet, it can be a more effective tool for adding younger members. You may want to keep an older, contributing board member but term limits encourage overall turnover and refreshment.

We have written many columns on board evaluation and the use of a talent matrix. Of course, such processes will help weed out underperformers; but more critically, it can help identify skills and connections a board should have going forward. Focus your evaluation on this talent shaping, and you will find that your targets look younger and more diverse.

The next step is finding younger talent. Task your nominating committee with this and you’ll find that younger talent is all around you. Focus your search on skills and current talents, rather than titles and years of experience to widen your pool of prospects.

Beyond the names that your current directors (or search organisations) may know, there is a global roster of young CEO and executive networking groups. From the worldwide Young Presidents’ Organization chapters to your own industry executive networking groups, there’s endless potential.

If adding younger board talent prompted you to upgrade your board search processes, the vetting and interviewing process should also be more professional. Since you are seeking new-age skills and achievements, interviews should look more like those for hiring top talent and less like chatting with old pals.

What specific, quantifiable ‘wins’ does the candidate have in the areas you seek? Ask the young candidate to do some homework on hypothetical strategic and governance issues facing the organisation, and what his or her suggested course of action would be.

This may be the young, mid-career prospect’s first board role – so is he or she familiar with the legal duties of a director? Given these candidates’ present career demands, can they devote time for outside board work?

Now that the young talent has been found and joined your board, what’s next?

Realise that both your current board members and the young directors will be feeling ill at ease. The young directors will be inexperienced in boardroom work and may feel out of place. How do they cope? We recommend that they listen a lot and talk much less during the first few meetings.

They should also be encouraged to find mentors within and outside your own board, to learn about the business and board duties. We recall how one such mentor put together a helpful syllabus of board information for such youngsters.

It’s also a good idea for them to have informal coffee chats with senior board members before the beginning of a corporate session and review board material together. Building their knowledge before they pop up with ideas and suggestions will help establish the young director’s boardroom credibility.

According to a young lady director, one of the most overwhelming learning curves was that all those acronyms and abbreviations are not easy to find on the internet since most are internal to the organisation.

So prepare your young director with a tool that we have often recommended in the past – a one page ‘cheat sheet’ defining all the acronyms, abbreviations and terms of art used in your board materials.