9 Mistakes Made With Board Refreshment

If you’re experienced in board succession planning, you know it’s more of an art than a science. You may know exactly what the board needs on paper, but finding that person can be like looking for a needle in a haystack.

There are a lot of outside pressures these days too – investors are looking more closely at a board’s composition and how the processes that evaluates & brings on new directors works.

Rightfully so, given the not-so-distant-past history of how new directors were selected –the CEO packing the board with his good-time buddies.

This might still be the case today at more companies than you would think. A power play with the CEO still happens. Director searches involve “search” in loose terms – the process starts by opening it up to the board: “Who would be good?” It’s definitely a more transparent process than it was, but it’s still stuck in the past to an extent at many companies.

If private equity is involved as a big owner in the company, the board may be run the way venture capitalists run the boards that they fund – the board is very active in managing the company. So this all can be a bit of a minefield.

Here are 9 things you should know related to board refreshment:

• Expanding rather than replacing
• Start with a board matrix
• Always look for new directors
• Move fast if find rare skills/attributes combo
• Maintain a list of referred candidates
• Consider the board’s culture
• Be aware of jumpers
• CEO experience & financial expertise still desired
• Board tenure, diversity & investor desires matter

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