August 27, 2020
Do you have what it takes to chair a board?
As a prospective board chair, you have a number of different motivations to take up the post, for example a strong sense of purpose or a desire to share your cumulative wisdom and experience with the next generation of leaders. You may wish to give back to the business community, to stay intellectually engaged and challenged, or to continue to exercise leadership skills, albeit in a different setting/context. Quite possibly, all of the above.
Whatever your motivation, your effectiveness as a chair will depend on the extent to which you possess certain attitudes and characteristics.
To start with, it is important that you can really empathise with the company and what it does. You will be spending a lot of time there, after all. A dose of humility is required, too; remember that the chair is much less important to the company than the CEO.
Try to have a clinical, disinterested view of your own position in relation to the company and have nothing to prove. Be relaxed about giving advice, then standing back and letting the executive team execute.
As a chair, you need to lead, yet not in an executive way. Some of the most interesting candidates are attractive because they have had a successful executive career as hard-charging drivers of value. Yet in a board context, leading from the front is counterproductive. If that is your modus operandi, you will need to park your executive impulses outside the boardroom.
You will have to switch from providing challenge and critical scrutiny when the company is doing well to supporting the executive team when their backs are against the wall.
Take pleasure in ensuring the success of others while taking no public credit. It has been said that a good chair takes more than his or her share of the blame and a little less of the credit. If you are the story, something is wrong. Be happy to lead from the front in bad times and from the back in good times.
As a chair you may well be leading a board outside your core domain of expertise. This is necessary to avoid conflicts. The most senior chairs in the FTSE often sit on other boards in unrelated sectors, while keeping the number of board seats they hold to a sensible minimum. Perhaps only one of their boards is in a sector where they gained their executive experience.
Be prepared to serve the interests of the company, its shareholders, employees, customers and wider stakeholders and sometimes at your own expense; for example, being willing to stand down in response to a major mistake in order to protect the position of the CEO.
Finally, you will have to be prepared, in extremis, to step in to run the business, should the company for any reason unexpectedly lose the incumbent CEO.
Personal qualities
While every chair is by definition unique, we have identified a few common traits that the most effective chairs typically possess:
-
Foresight, meaning the ability to look and act beyond the executives’ horizon; commitment to a long-term sustainable approach;
-
Good humour and calmness under pressure; an ability to conjure calm from chaos;
-
Humanity, understanding and respect for others;
-
Being a good, active listener;
-
The courage to hold one’s own interests subservient to those of the company;
-
Emotional intelligence to read the mood of the board and decipher non-verbal clues;
-
Social accessibility and an ability to be at ease with all employees from the most junior to senior;
-
The toughness needed to hold onto the course when it is right to do so, despite crosswinds;
-
Complete lack of sentimentality, meaning the ability to fire people, including the CEO, and to change tactics when this is deemed essential;
-
Huge amounts of intellectual curiosity about how different business sectors work.
In my next blog I will explore how the appointment process works.
This article is an extract from Becoming a non-executive chair, a guide for people who aspire to become chair of the board or are becoming a chair for the first time. It describes the steps to becoming a chair, what the role involves, and the personal characteristics needed to chair a board effectively.
If you would like to discuss any of the issues raised in this blog, please contact wdawkins@spencerstuart.com.