How do our board practices compare to our competitors?
What are boards in our peer group doing to create sustainable, competitive advantage?
How are companies in our industry and sector handling Dodd-Frank?
Is our director compensation package too lavish?
Do we have an adequate succession plan in place to lead our organization through a sudden change in leadership?
Have we adopted the kind of internal codes that set the right tone at the top?
Is our board’s composition optimal, and do we have the right board leadership structure in place?
These are the kind of questions that can keep an honest and committed corporate director up at night. In this age of heightened public scrutiny, the answers to these questions can mean the difference between success and failure—and between acclaim and scorn.
NACD offers a comprehensive assessment that allows corporate boards to determine how they stack up against other boards and gives them actionable steps to improve any shortcomings. The NACD Custom Board Benchmarking Report provides data on nearly 70 board practices, including board priorities, board size, use of independent consultants, ethics codes, executive compensation metrics, CEO succession plans and more. The data is broken down for twenty-four industries. Depending on a board’s interests, the data can be analyzed by a number of criteria, including industry, company type (public and private), listing exchange and market cap.
It is a one-of-a-kind tool that helps boards figure out what they are doing right and where they can make improvements. A company can determine, for example, if its failure to hire an independent consultant for a given task places it outside of normal industry practices. That valuable bit of information can help directors avoid trouble down the road.
The NACD Custom Board Benchmarking Report enables directors to strengthen their organizations by identifying new areas of interest and cutting-edge practices among their peers at other companies and in other industries. This service also helps directors build robust boards that can withstand the vicissitudes of the marketplace—boards that can establish a clear vision and mission to move their businesses far into the future.
By eliminating the trial and error in the boardroom, this customized reporting service helps corporate directors to advance exemplary board leadership.
Fay Feeney is CEO of Risk for Good, an advisory firm providing board chairs and corporate counsel guidance to monitor, govern and leverage the fast-moving landscape of social media, technology and the Internet.
One of my table mates at the NACD Director Professionalism course I recently attended in Deer Valley, UT was Allan C. Golston, president, United States Program of the Bill & Melinda Gates Foundation. It’s amazing who you sit next to at NACD events. Allan swore his learning wasn’t disrupted by my tweeting during class, and shared with me his takeaways from two days with NACD.
“The course was more than ‘rules of the road’; it was also a dialogue around how to think about the fundamentals of being an effective director in the 21st century in a strategic way. Whether it was rethinking what it really means to have an independent mindset, or rethinking what it means to have courage in the boardroom, or rethinking what it means to represent shareholders—I found these types of fundamentals the most useful.”
Allan Golston with Rob Galford, Compensation Chair, Forrester Research and NACD facilitator
I agree. I invested my time and money to have a refresher on fiduciary responsibilities and to pick up some useful tips on how to contribute most effectively in the boardroom and on key committees, but I came away with so much more: insights that have reshaped my thinking about how to lead in governance and examples of great board behaviors that will galvanize my own priorities and performance.
Mike Lorelli, CEO of Water-Jel Technologies, and another high-flying classmate, agreed. “As much learning in two days, as in two years of an MBA program,” he said.
Mike Lorelli at the NACD resource center
The sessions at Director Professionalism are led by active public company directors. I loved hearing Michele Hooper, who sits on the boards of Astra Zeneca, UnitedHealth Group, PPG Industries and Warner Music Group, encourage newbies by saying: “Everyone has a “first” board seat. Today’s most experienced directors had a first board seat.”
She encourages boards to consider qualified candidates without prior director experience, maintaining that, if your board is looking to expand their recruiting to engage more diverse thinking, they will need to refresh their thinking about board composition.
Although the NACD facilitators were great, the really valuable learning often came from other members of the class. “There really weren’t 10 instructors—more like 70 when you count the learning from the 60 peer-level CEO’s and directors,” said Mike Lorelli. Allan Golston agreed.
“The ‘official’ instructors were really strong, but the interplay and dialogue among the group enriched the content and learning well beyond what the official instructors provided.”
Pamela Packard is a private company director who is active in NACD’s New York chapter. She felt that the snowy setting of the Montage Deer Valley Resort provided lots of opportunities for “off the record” candid conversations among directors from diverse backgrounds and experiences. “These discussions complemented the formal sessions.” She also told me “newcomers to corporate governance had the chance to glean the subtleties of different board cultures and communication styles, learning from those of us with more experience.”
Pam really valued the plethora of publications and extra learning resources provided by NACD. “Great reference materials for future use!” she said.
Director Professionalism has a comprehensive list of learning objectives but really these were just the starting point for our class. In the fast moving world of governance, it’s not only what you know, but who in your network can help you keep your knowledge current. Thanks for a great class. I’ll keep on learning with NACD and look forward to becoming a 2011 NACD Governance Fellow.
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