On Monday, 22 May, we held a Senior Independent Director Dinner at the House of Lords where Caroline Silver, Chair-elect Barratt Developments plc & former Chair for PZ Cussons, Sir Mike Rake, Chair of Great Ormond Street Hospital & former Chair for BT Group, EasyJet, Worldpay and others, and Suki Sandhu, CEO & Founder, Audeliss and INvolve, discussed the key experiences and credentials needed to be an effective Chair, and how Directors can be confident in supporting a candidate without the traditional track-record.
The dinner was an excellent opportunity to hear from senior Directors about succession planning for the Chair seat, evolving trends, and key experiences and credentials needed to be an effective Chair.
Some of the themes discussed included the changing role of the Chairperson, Chair succession, key skills required, and the experiences of newly appointed Chairs.
Key trends evolving in the boardroom
The panel began discussing the evolving trends in the boardrooms and the impact that these have on the Chairperson. In addition to this, the panel mentioned how the companies are responding to ESG and the cost of meeting the targets set for the Board while representing the best value for the planet.
The key trends on the agenda included: cybersecurity, cost of living crisis, operational resilience, and supply chain. What is happening worldwide affects people and the workforce, which means it affects boards directly.
The panel also agreed that there is a much broader and more diverse community of people on the boards now, so it is essential to consider diversity in the discussions across the boardroom. Diversity is incredibly important in the decision-making process – especially diversity of educational and socioeconomic backgrounds, since it provides a range of experience and perspectives to draw on during moments of crisis.
The changing role of the Chairperson
The need to perform has increased, and the Chair’s role is organic. Changing that one person within the board structure changes the whole dynamic of the room and for that reason, it is incredibly important when it comes to changing the Chairperson. There needs to be special considerations when it comes to carrying out training for the individual, and careful planning is essential for effective succession.
It’s all about people, culture, and bringing together a team to work. The Chairperson needs to be aware of the balance between protecting the Chief Executive and holding them accountable. The skills of patience, the ability to look at the horizon, and understanding and balancing human elements are needed – alongside the ability to work cohesively with other board members. Bringing together the Chair, CEO, and CFO is extremely positive for companies when the relationship works. It is also essential to keep the engagement going and prepare the board for big decisions since they will be relying on the Chairperson to lead and help navigate difficult moments.
Key skills for the Chair
People skills are essential, but also standing back from detail. A Chair needs to have awareness of the internal politics within a company so the ability to listen and communicate is crucial to understand the dynamics of the board. Balancing context and how to work on strategy, while being honest on the best person to deal with situations recurrent within the company, is a key skill.
Offering essential support while still challenging board members around duties and reponsibilities is also a key skill needed to perform in the role. The Chair should represent the culture and reputation of the company, externally and internally. The panel agreed that the Chairperson is also the ‘Chief Reputation Officer,’ and it is important to spot these qualities when someone is making a move to becoming a Chairperson.
Choosing a first Chair and succession
When choosing the Chairperson or a successor, boards need to be honest about what skills they have around the table and the strengths and weaknesses of the CEO – doing a proper evaluation (including self-assessment) at both board and executive level is imperative. A safe space needs to be promoted where it is comfortable for the board to explore their weaknesses.
On succession, it is also necessary to ensure that the CEO’s voice is heard, and since their relationship is highly significant, the outgoing Chair must ensure that their successor is the right person to work alongside the CEO.
It is important to consider the future strategy of the company when selecting a new Chair and ensuring there is alignment between the company’s strategic and commercial goals and aspirations, and the aptitude and attitude of the new Chair.
Allowing the next level of talent to join the Board
A good way of building a suitable cohort for the future is allowing the executives to move to non-executive roles. Chairs can then work with that person to prepare them for the challenges they will face.
The panel also mentioned that the board should talk to a search firm and make clear that the company is ready to consider people that are not currently in the role of Chair but have great experience. Persuade your board colleagues to take the risk to broaden the talent pool to find the best fit in terms of skill set and industry knowledge, and to prepare the company for what is ahead.
Continuing the Conversation
Our appreciation goes to our panel, the House of Lords, and to everyone who attended and contributed their opinions and experiences.
Audeliss has been supporting organizations with diversifying senior leadership for over 12 years, and if you would like to talk to us about your approach to diverse executive search, please get in touch.
