Prof. Shekshnia spoke at a Women on Boards breakfast at Maddocks Law Firm on the topic of CEO, Chair and Director Selection. He was in Sydney to present at the first ever session of the INSEAD International Directors Program (IDP) to be held in Australia; an achievement of the partnership between WOB and INSEAD IDP.
He told the assembled crowd that there was “a big difference between what makes you a board member and what makes you effective in the boardroom.
What makes you effective in the boardroom?
- Listening, questioning, feedback (soft skills)
- World class expertise
- Ambition for the institution
- Openness and learning capability
- Personal humility
- Time and mind commitments
What do companies recruit their board members for?
- CV (institutional affiliations)
- Specific area of expertise, e.g. industry knowledge or M&A
- Director’s soft skills
You need to be a man and a CEO to be a chair
Prof. Shekshnia went onto discuss how organisations select their chair – citing various governance models used. However, in all cases, there were two stand out characteristics for chairs across Europe:
- You need to be a man a become a chair in Europe
- You also need to be a CEO to become a chair in Europe
||# of Chairwomen
||% of Chairs with CEO background
However, the research also found it takes a woman more than being a CEO to become a chair in Europe with those who achieved this position being of higher than average age at first appointment and having experience as an independent director and formal education.
….and once again it was the soft skills that make a chair effective, ranking in order of importance as:
- Humility and ego management
- Patience, calm and reflectivity
- Availability and presence etc
- Listening, speaking, questioning, framing and reframing
- Systemic thinking and business acumen
CEOs selected on all the attributes that does not make them good chairs
Interestingly and paradoxically, the attributes for which those who were selected CEOs & the people most likely to become chairs are:
- Ambition and results-orientation
- Boldness, decisiveness and risk-taking
- Organizational centrality
Prof. Shekshnia told of how the culture almost dictates a man will get the CEO and Chairs roles and there is much work to be done educating nominations committees and recruiters. He recounted how a senior partner in board practice at a global executive search company, who admitted that; “when a client talks to me about a potential candidate to replace a board Chairman, I automatically think about a man.
We started drafting a profile of my successor with an open mind. Yet in no time we were discussing what experience and attributes heshould have.
Former chair of 3 FTSE-200 companies’ boards.:
Other points made by Prof. Shekshnia were:
- There is no real process for recruiting a chair; the most common methods are incumbent led succession, shareholders led search and selection or board / committee led succession
- Boards are not good at selecting CEOs.
- Many CEOs do not consider it their business to find and nurture successors.
- The proportion of outside recruits is highest in Australia 50%+.
Prof. Shekshnia’s observations were based on his experience as a NED and chair; 15 years consulting boards and shareholders working with 60 chairs and 400 board members a year at INSEAD and a six years-long research project.