As NACD works with corporate directors of public, private, and nonprofit boards to oversee and ensure the long-term sustainability of the enterprise and bolster investor confidence, I am frequently asked: “What companies have the most significant challenges?” While unique challenges certainly exist across boards of all company types, many view the roles of small-cap public company boards to be quite challenging.
These unique challenges span time and effort (workload) requirements, compensation, talent, financing, regulation, risk, strategy, competition, and internal resources, just to name a few. Small-cap directors and governance professionals may identify and prioritize the unique challenges of these companies differently, however, but one thing remains constant and that is that small-cap companies represent the majority of companies listed on U.S. exchanges, and the long-term prosperity of these small-cap companies is essential to a growing, thriving economy.
So where can small-cap company directors turn to reinforce their strategic agility?
Second, I highly recommend that all directors read NACD’s Board Building white paper, another high-impact, quick read. Most important in this resource is the skill set matrix enclosed in the appendix. Many companies are now using the skill set matrix to both determine and articulate the experiences and talents required for their future strategies.
Lastly, I suggest that current and aspiring small-cap directors attend NACD’s Small-Cap Forum on April 10 in San Antonio or on July 17 in San Francisco. Both sessions will focus on current and emerging issues facing small-cap boards, and these interactive events will include a range of interactive, peer-to-peer networking opportunities for robust dialogue.
Contact me at hstoever@NACDonline.org if you have specific questions or suggestions on how NACD can assist you, your board, and other small-cap directors advance exemplary board leadership.
National Association of Corporate Directors (NACD) President and CEO Ken Daly opened the second day of the annual NACD Board Leadership Conference with a status report of where the organization is now and where it is headed.
14,000: Number of NACD members.
75: Percentage of members who are public company directors (about 1,000 are full board members).
93: Percentage of member retention.
3,000: Participants in 2013 NACD education events.
10,000: Number of NACD webinar viewers.
1,000: Number of NACD Fellows.
22: Number of NACD chapters—5,500 people attended chapter events.
28: Pieces of intellectual capital NACD has produced this year.
4: Number of NACD advisory councils, which focused on board committees (audit, compensation, nom/gov, and risk).
NACD Directorship 2020™ is the main vehicle that NACD will use to drive conversation about the future of the boardroom. Directorship in 2020 and beyond will undoubtedly provide new opportunities and thus, will require innovative resources that directors must be prepared to embrace. NACD Directorship 2020 convened three meetings across the country this year that will inform the dialogue going forward, and more events are set for 2014.
Additionally, NACD is planning a meeting on capital markets which will convene institutional investors and directors to begin a dialogue about priorities for the future.
Fact: we live in a world of data. Today, nearly every strategic decision is fortified by metrics and dashboards, analyzing the projected outcome to the smallest degree. This is equally true at NACD, where our annual governance surveys—public, private, and nonprofit—underlie nearly every aspect of the organization’s activity. From publications and presentations, to peer exchanges, and our annual Board Leadership Conference, data collected from the thousands of respondents informs the sessions, forums, topics, and future events. Beyond the boardroom, the trends, statistics, and perspectives captured in these surveys provide those in the C-suite, investors, and stakeholders with crucial information on the current state of corporate governance in the United States.
In the regulatory sphere, we use survey data to inform our comment letters and in-person testimony on behalf of boardrooms to regulators and lawmakers. For instance, survey responses from NACD’s membership strengthened CEO Ken Daly’s comments to the Public Company Accounting Oversight Board (PCAOB) regarding proposed mandatory audit firm rotation, and the recommended alternative of a widely supported rigorous evaluation process. The PCAOB’s initiative on audit firm rotation is now “paused.”
NACD’s three annual governance surveys can help fuel your board’s process in benchmarking with respect to peers and leading practices. Whether you use a general report, or commission an NACD Custom Benchmarking Report, data broken down by industry, size, or both serves as an excellent starting point for boardroom discussions.
NACD is dedicated to providing directors with timely and pertinent content, but we need your input. As a thank you for participating in these surveys, NACD will send each participant a free electronic copy of the final report for each survey he or she takes. In fact, each survey respondent is entered to win a one-year NACD Individual Director Membership, or an opportunity to extend NACD membership. We thank you in advance for your participation.