There are few companies and board rooms where the subject of diversity has not been the focus of debate or at least discussion in recent years. From its close connotations with gender, ethnicity, age among other familiar categories, over time, board diversity in its truest sense has evolved to develop a much broader understanding; ‘diversity of thought’. It is therefore widely accepted that an effective board must be equipped with the diversity of opinion necessary to make its governance and advisory role meaningful.
Realize the Value.
At a fundamental level, board members and companies must understand and share agreement as to the underlining value generated through the achievement of a truly diverse and effective board. Without this, there is no foundation for progress.
Instate a systemic and rigorous appointment process.
Boards of all shapes and sizes must establish and follow a consistent and robust recruitment process and command a diverse shortlist of candidates to select from. This will include clear definition of the job and person specification; the search strategy and the assessment and evaluation processes. In line with best practice, such a process will also embrace such codes as fitness, probity, merit, transparency, openness, accountability among others.
In most instances the board chair together with the nomination committee will play an integral role in driving the diversity agenda. It is imperative that such responsibility is embraced by all such parties. This process will commence with the definition and scoping out of the job and person specification to the later stages of onboarding and transition of the appointed board director.
Assume a fresh perspective.
When board directors and chairpersons expand their focus from replacing one leader with the same or similar a door to a new and more diverse candidate community is likely to open. By example, there are many tremendous General Managers and Functional Heads that possess the same skills that make CEO’s as such attractive candidates – solid leadership capability, strategic vision, technical nous, as well as excellent communication and commercial acumen and agility to learn and adapt.
Create an ecosystem for diversity.
There is great benefit to diversity at all levels of the company hierarchy. Companies through a concentrated range of strategies can create an ecosystem to nurture talent and promote diversity. By example, to achieve gender diversity, it is critical for companies to build relevant flexibility and support programmes for women leaders to assume or to continue in board positions.
Board diversity is much more than just a question of fairness. To undervalue it, represents a lost chance to acquire fresh thinking, expertise and knowledge of different markets, customers, processes and more. And it can adversely impact decision making, corporate governance and commercial performance. Indeed, culturally homogenous or ‘group think’ boards can often encounter significant blind spots in perceiving and reacting to various environmental shifts, market developments, and in leading their companies’ future strategies. A robust and diverse board has therefore become absolutely critical, particularly in the face of heightened competition and the requirement for greater board accountability and transparency.
Principal Connections is committed to the diversity objectives of its clients, which are reflected in our own values, in the configuration of our own firm, and in our executive search and leadership advisory practices.
Principal Connections is Ireland’s leading retained Senior Executive Search and Headhunting Firm and the Irish Arm of Agilium Worldwide Executive Search Group, one of the World’s largest and top Executive Search Organisations.