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Spencer Stuart Director Pulse Survey: Board Matrices

June 2022

Spencer Stuart’s inaugural pulse survey of directors on the use of board skills matrices found widespread adoption (78%) at public company boards but limited use (33%) by private company boards. However, on many of the issues underlying board matrices, the nearly 900 responding directors of private and public company boards were directionally aligned, although public company directors (60% of the survey group) generally reported more positive views of the tool.

Public and private company directors on boards with skills matrices overwhelmingly found them effective, with nearly 80% saying the matrices accurately reflect their board’s composition and just under 60% describing their matrices as very or extremely effective in contributing to board succession.

The lion’s share said they: (1) revised the matrix in recent years to add skills (74%); (2) evaluate the matrix every year (72%); and (3) formalize definitions of skills (64%). Most (nearly 60%) reported that directors fill out the matrix with their board composition skills. Just over half (56%) of the public company directors said they publicly disclosed the board skills matrix.

While about half of the 560 surveyed directors with skills matrices agreed or strongly agreed that the skills matrix is a compliance obligation, nearly three quarters agreed or strongly agreed that the matrix is an important tool for communicating the board’s composition to investors and other stakeholders.

The survey suggests that boards currently not using a skills matrix are unlikely to adopt one. Two-thirds of the 330 directors on boards without skills matrices said they were not considering creating one. And most — 62% — said they were not currently evaluating their board’s composition.

Does your board have a composition skills matrix?
How accurately do you think your skills matrix reflects the composition of the board?
Public Co. Private Co. Combined(Pub+Pvt)
Very inaccurately 2% 4% 2%
Inaccurately <1% 1% <1%
Somewhat inaccurately 1% 8% 2%
Neutral 2% 2% 2%
Somewhat accurately 13% 25% 15%
Accurately 60% 48% 58%
Very accurately 22% 11% 20%
How effective is your board matrix in contributing to boardroom succession planning?
Public Co. Private Co. Combined(Pub+Pvt)
Not at all effective 3% 1% 3%
Slightly effective 2% 5% 2%
Moderately effective 33% 51% 36%
Very effective 52% 39% 49%
Extremely effective 11% 4% 10%
Check all that apply to your board’s skills matrix (check all that apply):
Public Co. Private Co. Combined(Pub+Pvt)
We’ve revised the matrix in recent years to add specific skills, experience, and attributes 78% 57% 74%
We evaluate the board matrix every year 76% 56% 72%
Definitions of matrix skills and expertise are formalized 67% 49% 64%
Each director fills out the board composition skills matrix 60% 51% 58%
We publicly disclose the board skills matrix 56% 5% 47%
Our GC/corporate secretary fills out the board composition skills matrix. 50% 27% 46%
We’ve revised the matrix in recent years to remove specific skills, experience and attributes. 21% 16% 20%
Directors are limited in how many boxes they check 6% 6% 6%
An independent third party fills out the board composition skills matrix. 6% 5% 6%
Rate your level of agreement with the following statements:
Strongly agree Agree Neutral Disagree Strongly disagree
The skills matrix is a valuable tool for succession planning

36%

55%

7%

2%

1%

The skills matrix is a compliance obligation / part of the board assessment “checklist”

10%

39%

25%

23%

3%

The skills matrix is helpful in holding directors accountable for their areas of expertise

6%

39%

34%

18%

3%

The skills matrix is an important tool for communicating our board composition to investors and shareholders

23%

51%

20%

5%

1%

Are you considering creating a board composition skills matrix?
If no, are you currently evaluating your board composition?