The biggest risk to boardrooms

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Your approach to governance is holding you back

I’ve met a lot of board members over the years.

Either as execs or non-execs, there is an approach to filling these positions.

The subtext of the appointments goes something like this…

Are you consistent? Do you have long term, narrow yet deep experience in a specific area? Have you risen up through ranks in a linear fashion without any notable disruption? Are you a member of one or more ‘institutes’? Can you manage order and ensure continuity? Then please contact…

The key word in Boardland is governance. The archaic nature of the word simply means to rule or control! It’s not a very nurturing term, yet it is a specific requirement of a public company’s board in the UK Companies Act of 2006.

Governance tends to happen through the work of a board’s respective committees. Of which the usual suspects are audit, finance, risk, nomination and remuneration. Are you falling asleep yet?

The bit I actually find interesting is risk. Because a risk committee will predominantly look at risks the company faces and the avoidance of them.

For me, there needs to be a change in attitude, risk is simply opportunity by another name. Just as disruption is invention’s consequence.

I’m not advocating that a board should be more frivolous, simply that diversity on boards goes beyond gender and race, it must include a healthy balance of risk aversion and risk taking. And that can only happen when a chairman recruits a board capable of opportunism, innovation, invention and connecting information to find new value and growth.

My point, as it always is, is invention and reinvention are the primary requirements for a business to survive and thrive (not even innovation will save you if your system itself is redundant).

Invention and reinvention are the primary requirements for a business to survive and thrive.

So board recruitment strategy needs to change. Especially if you want your business to be the disruptor rather than the disrupted.

So free of charge, as a gift from me to you, I’ve written your next non-exec appointment ad for you.

Are you flexible? Do you have years of broad experience in a variety of subjects? Have you worked with diverse sets of people in erratic and unpredictable environments? Have you caused and been party to disruption? Can you handle chaos and manage change? Then please contact…

And if it helps, I know a ton of great people who fit the bill.