Senior executives and board directors will continue to face complex new governance and leadership challenges in the decade ahead. To that end, Harvard Business School (HBS) professors Suraj Srinivasan and Lynn S. Paine have launched Preparing to Be a Corporate Director. Here, they discuss the distinctive skill set that’s needed to contribute at the highest level of an organization.
Srinivasan: Over the last 20 years, the social impact of businesses has become increasingly more important. In turn, boards have been tasked with more and more responsibilities. We've seen this transformation both in the United States as well as around the world. It's a global phenomenon that's reshaping the role of corporate boards across industries and countries.
Paine: Jurisdictions differ in terms of their legal requirements, cultures, and economic conditions, so there's a lot of variation worldwide. Despite the nuances and differences, the tasks of the corporate board are fundamentally the same. Going forward, all board directors will need to expand their focus and skills as they consider the broader needs of all stakeholders.
Paine: Our goal was to provide a richer and more comprehensive view of the various board tasks and its specialized committees. We start with the big picture: Why is this group needed, and what are its dynamics? What are the board's functions and responsibilities, and how do they differ from those of its committees? Then we delve into topics like CEO selection and succession, board renewal and evolution, and oversight of corporate culture.
The curriculum is designed for senior professionals, including current C-suite executives, whether retired or preparing to retire; C-level board-facing executives; partners from audit/consulting firms and private equity/venture capital firms; nonprofit board directors aspiring to corporate board service; and our alumni.
Srinivasan: The overarching theme revolves around this question: What does it take today to succeed as a corporate director? Most senior executives know what a board generally is, but they haven't been on the other side of the table, so to speak.
We dive deep into the challenges, responsibilities, risks, and opportunities that come with serving on a corporate board. This includes thinking about the role and purpose of the corporation, and overseeing corporate strategy, due diligence, reputation management, and fiduciary duties, as well as considering the unique dynamics of sitting around the table with 10 or so people you don't meet with frequently in order to make critical decisions for the company. It takes a while to start creating a sense that "I am a part of the leadership group of this organization," so we provide a roadmap for navigating the process.
Srinivasan: The corporate board functions as a collective entity, but it also works through specialist committees. Some areas of work are specialized, such as executive compensation and financial reporting, requiring that you have advisors, consultants, and financial experts to help the board. There are only about 10 people on a board, and most boards will have at least three committees. So people may be serving on multiple committees—finance, strategy, audit, compensation, and governance, for example.
Knowing what the company needs requires both industry-specific knowledge and domain knowledge—putting a board together is a careful art, because you’re trying to balance so many different things. You need specific expertise, but you also need broad knowledge.
Paine: The responsibilities of serving on a board today require a distinctive set of skills. We present a framework for expanding your current skill set and developing a personal strategy for board career success. This goes back to your motivations for joining a board and takes into account your skills, strengths, and ability to manage your personal reputation during an organizational crisis.
Experienced directors will be on hand to share their firsthand experiences on what it takes to become board ready, evaluate board service opportunities, and successfully integrate board service into your career.