A recent article in McKinsey Quarterly by William George caught our eye due to its focus on boards and the differing roles that individuals can play in them. Board support being one of the main services we offer to clients, the article struck a chord with us. The article suggests that an individual’s perspective on the board they sit on can be drastically influenced by what position they have on that board, be it CEO & Chair, Non-Executive Chair or Independent Director. More interestingly, George analyses how those in certain positions can manage their behaviour to ensure that they act in the best possible way in that role to benefit the company.
Wellmeadow often act as an independent director on boards. As our clients are from a range of sectors there are some parallels that can be drawn between George’s article and our own experiences. George refers to the role of independent director as being “much more important – and difficult – than it was in years past”, one of the reasons being that if an individual serves on a variety of boards, it is very unusual for them to have in-depth knowledge of each company’s sector. George shows that what may at first appear to be a negative, can be a positive as the lack of specific knowledge the director has can allow them to be more objective. In fact, as the director may have the experience across a variety of sectors, this experience will bring with it greater clarity and the ability to apply their knowledge across sectors. As George puts it: “information asymmetry”.
This experience and the fact that we are a dedicated consultancy bring many other advantages. Over the years we have honed our own process for board meetings that we apply to each company whose board we sit on. We strongly agree with George that “process matters hugely in the boardroom”. Companies that have been founded by a director who has never before chaired a board, can not only draw upon our sector-wide knowledge, but also upon the structure we bring to boards. This allows for companies to focus on the areas that need to be discussed, and not get distracted by issues which do not add to the discussion.
Companies will often only face a handful of major crises within their lifetime. Without an independent director who has had the benefit of observing other companies in crisis, the board may struggle to cope. George quite rightly demonstrates this with his comment “independent director’s…accumulated wisdom and judgement are crucial to make sound decisions” and to guide through these crises. However, “good chemistry is important” and the experience an independent director can bring to a company is worthless if this chemistry is not right.
We pride ourselves on our in-depth knowledge of our clients in order to understand them and their company. This allows us to adopt the correct persona for a particular company to be sure that our role is suitable and will help the company in the way they need to achieve the best results.
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If you are a company who feels their board could benefit from a defined process for their board discussions, we would be delighted to hear from you. You can contact us online or on the phone, 01743 234031.