Starting your board journey: Six steps to guide director hopefuls

Courtesy of McKinsey & Company

By Celia Huber, Nina Spielmann, and Ilana Wolfe 

Key takeaways

Board service is an opportunity for personal and professional growth. Directors can develop new skills and gain exposure to different governance processes and leadership styles.

This article offers key takeaways from more than 30 conversations with seasoned corporate board members as part of Spotlight, our joint program with Goldman Sachs, to help underrepresented US director hopefuls understand the process, demands, responsibilities, and rewards of board membership. The insights suggest the path to corporate directorship includes six core steps: understanding the board role and your objectives, increasing your visibility, researching the company and its industry, getting the most out of the interview, selecting the right board, and finding your voice as a director.

Understand the board role and your objectives

As many employers allow executives to serve on another company’s board, one factor to carefully consider is whether you are qualified for the demand of the role. Board service can require anywhere from 200 hours a year to 20-plus hours a week, and you should commit to serving at least five years. Firstly, decide how much time you could devote to board duties without detracting from your main job—not to mention balancing your calendar with your personal time.

Next, consider the types of companies you would like to serve. There are significant differences between public- and private-company boards. While public companies are often stricter in rules and regulations, private companies may allow you a more hands-on experience. List the types of companies that align with your skills, interests, and purpose. Once you have board experience, you can become a valuable contributor to many other boards.

While noncompete agreements may prevent you from taking a board role within your industry, you may be able to apply your expertise to boards in other sectors. Such a position would take you out of your comfort zone and help you broaden your experience, skills, and personal network.

Raise your visibility

Board recruitment is largely relationship-driven. In their quest to find the right directors, boards will consider candidate references from colleagues and professional acquaintances, so it is important to leverage your personal network.

It is crucial to let your peers know that you are interested in becoming a board member and can bring valuable contribution to a company. Always look for ways to raise your profile in your industry, such as speaking at conferences, and build relationships with recruiting firms and connections on professional social media platforms. But remember, it’s a two-way street: should you get a call for a board opportunity that does not interest you, consider referring others in your network.

Once you have concrete board opportunities in mind, think about how to tailor your résumé and profile on professional platforms to highlight ways you could fill gaps in those boards’ composition.

Since board members need to take a high-level, long-term perspective on the company, you should also demonstrate your ability to deal with strategic topics affecting the organization and its prospects.

Do your homework

Conduct thorough due diligence on companies whose boards they would be interested in joining. You can investigate the organization’s operations, challenges, and opportunities by reading news and analyst reports and speaking with people who know the company well, including board members and senior managers. Complementing these perspectives with insights from investment bankers, trusted advisers, consultants, or external auditors may provide a picture beyond what’s publicly available. This research can help alert you to any red flags, such as the company facing an attack by activist investors.

You should also study the backgrounds of current directors and top executives. Furthermore, it’s a good idea to include the industry to broaden your understanding of where the company fits within its sector.

Make the interview a two-way conversation

In preparing for the interview, it’s critical that you tailor your unique personal story. You should be able to concisely communicate your value proposition and be ready to share a handful of personal anecdotes that showcase who you are beyond the facts of your professional background. It’s also a good idea to seek input from trusted advisers and do dry runs of how you would share these stories so you are comfortable delivering them in the interview.

Additionally, be prepared to convey how you would bring different insights to the team, as many boards are keen to broaden their diversity, not just in race, gender, and other demographic characteristics but also in skill sets and perspectives.

Four traits that will likely be present on all recruiters’ lists are as follows:

·        Intellectual curiosity. Open to new ideas and willing to ask management and their board peers constructive questions that challenge group thinking and help produce the best decision.

·        Willingness to commit needed time. A new board member has to invest in understanding the company’s industry and operations and in preparing for meetings.

·        Understanding of the director role. The board’s role is to advise and oversee a company’s management. Former and sitting executives sometimes struggle with this aspect, as they are used to operating roles and inclined to solve issues rather than advise.

·        Humility and integrity. Great board directors exhibit humility, integrity, and collegiality. Board recruiters look for candidates who can work constructively with others on the board and within the company.

Select the right board

Don’t hesitate to request information and seek input to help you make the decision. Candidates should ask for the latest board assessment report and probe the company’s approach to managing risks that may be percolating. The company that you intend to join must be willing to share both positive and negative stories about them to show you full transparency. If you feel that you do not receive full cooperation, that might be a red flag.

Ultimately, your decision should be based as much on facts as on intuition. If something doesn’t feel 100 percent right, it’s probably not the right opportunity.

Find your place in the boardroom

To gain greater comfort with the board, try to meet each member before officially starting as a director, as building relationships and familiarizing yourself with the different viewpoints early can prevent conflicts down the line. New directors should also invest in getting to know the management team and key employees through formal and informal interactions to understand the business and identify top talent.

Always remember that your role isn’t to offer solutions but to probe and constructively challenge proposals brought by the management team to make the executives reflect on their decisions. Try to stay away from operations that you are used to; your objective should be to help the management team see ten steps ahead and think through all eventualities.

Most importantly, do not be afraid to voice your opinion from day one. Boards always expect their members to contribute fully. You could first test your ideas with select fellow directors who may have context on a given topic you may not be aware of and may support you during the boardroom discussion. To make valuable contributions during meetings, you can also carefully review the agenda and identify areas where you can add insights.

In sum, joining a board can be a rewarding learning experience if new board directors take the time to build relationships, understand the company’s culture and mission, and learn to collaborate with other board directors and management effectively. Ultimately, the success of a board depends on the willingness of its directors to work together toward a common goal, and new directors play a crucial role in shaping the board’s dynamics and achieving its objectives.

To read the full article, please visit https://www.mckinsey.com/capabilities/strategy-and-corporate-finance/our-insights/starting-your-board-journey-six-steps-to-guide-director-hopefuls  

About the experts

Celia Huber is a senior partner in McKinsey’s Bay Area office, and Nina Spielmann is a senior knowledge expert in the Zurich office. Ilana Wolfe is head of corporate board engagement at Goldman Sachs.