Shortcuts to Board Leadership - Part Two
In 2018, I published a blog entitled, “Shortcuts to Board Leadership” as I was getting quite a few requests (and still do) about how to accelerate one’s journey to board service, particularly in the private/public company sector. I’ve shared it with numerous people who have hopefully gleaned some insight from my two primary points: (1) Establishing a clear personal narrative about your uniqueness and (2) Becoming top-of-mind with those who nominate candidates.
Oh, and the punchline: There are no shortcuts.
Since that time, the pressure to diversify boards has increased even more. The continued threat of strategic disruption calls for more relevant skills around technology and cybersecurity. The social unrest incidents that took place in the summer of 2020 highlighted the need to increase opportunities for people of color. An elevated focus on ESG calls for voices in the boardroom that can help shape the strategic agenda of an enterprise’s role to the wider community. Finally, the changes brought about by the COVID-19 pandemic further advantages boards which have directors in touch with the changing desires and preferences of today’s workforce.
As a result of these factors, the traditional practice of considering only C-suite executives for board service is being questioned. More general managers, division-level CFOs, SVPs of technology, those with specialized industry skills, and individuals with only experience in academia or the public sector are weighing the possibilities of becoming directors. Particularly in the interest of diversifying gender and ethnicity, recruiters and governance committees are giving consideration for more specialized knowledge and perspective. I know this because of the calls and referrals I’m receiving from both recruiters seeking to widen their network and from individuals who seek those opportunities.
What was once a role only available to sitting/former CEOs, CFOs and a scattering of C-suite executives is now a possibility for those slightly lower in organizations. But as a result, the odds of finding those coveted board seats are becoming even more difficult as the net gets cast wider than it ever has in the past. How can candidates truly stand out amid the thousands of resumes being circulated to sitting directors and recruiters every day?
Although most companies have on-boarding programs, those are generally designed to familiarize new directors to the business of the enterprise. Because directors in past decades have been selected primarily from board-facing executive roles, it has been unnecessary to train individuals on the actual role of a director; they’ve all known how a board feels and operates because they've spent a great deal of time in the room. New directors today who might not have had board-facing roles (and have only presented to the board from time to time) should nonetheless have a strong understanding of the duties of directors and be able to participate as a full director from Day One of board service.
Fiduciary responsibility and oversight of strategy and enterprise risk continue to be among the primary role of the Board of Directors. Understanding these areas of a director’s role is critical, and a candidate can increase his/her advantage to be prepared. There are a few great programs that can prepare executives for board service; many are offered by university business schools or organizations that serve the board community. In the United States, the premiere organization for board governance, NACD, offers a comprehensive director certification. As an item-writer for the foundational exam and now a member of its Corporate Directors Institute oversight board, I can attest to its rigor, thoroughness, and relevance. Internationally, the Institute of Corporate Directors of Canada, and the Institute of Directors for the UK both offer good background for board service and assessment of board readiness in their respective markets.
The competition for board seats will only become more intense in the coming years. As the scrutiny of enterprise continues to grow in our society, having the right voices around the table becomes increasingly more critical. Positioning yourself as a qualified director with unique experience and perspective is the key to standing out from the ocean of candidates vying for slots. For those who haven’t held significant board-facing jobs, the attractiveness of your candidacy can be increased by investing in preparation. That combined with the two points I made in my initial blog will get you as close as you can to a shortcut.
Leadership and ESG
Investors Have Spoken: What Can We Learn About ESG from the 2021 Proxy Season?
The 2021 proxy season marked the apex of a tumultuous year in which companies tackled pandemic mitigation, work-from-home environments, and urgent conversations around racial inequity and the climate crisis—meaning environmental, social, and governance (ESG) issues reached heightened importance in every boardroom.
The corporate ESG focus culminated in the theater that took place at the Exxon Mobil Corp. annual meeting in late May. On that day, a small but impactful activist organization teamed up with three large institutional investors to take on what was once the most powerful company in the world. When the dust settled and the final votes were tallied, three of the board’s longstanding directors were unseated.
Changing attitudes around the role of enterprise in our society mean that board directors and executive leadership across the business world must engage on ESG. During the recent NACD Texas TriCities Chapter webinar “2021 Proxy Season & ESG: What Just Happened?” speakers Anne Sheehan and Kris Ramesh addressed the reasons for ESG’s elevated agenda position, the challenge of measurement, and the consequences of thinking of ESG as a blip that will go away.
Here are some key insights from the webinar, which was moderated by chapter board member Travis Wofford.
Having Deliberate Conversations
Commentary during the webinar emphasized one key point: although ESG is here to stay, how we measure both inputs and outputs has yet to be decided. Organizations such as the Value Reporting Foundation and the Task Force on Climate-related Financial Disclosures are attempting to create standardized reporting, but with multiple players in the game, the waters are muddy.
That being said, having deliberate conversations in our boardrooms is paramount. How we address ESG at the board level impacts not only a company’s license to operate—in many industries—but can also provide strategic clarity and competitive advantage. Two questions that all directors should consider: What inputs will result in measurable outcomes? What ESG metrics are critical and material to our company’s operations and strategy?
Looking individually at “E,” “S,” and “G,” directors should also consider the following questions:
Environmental:
Based on greenhouse gas and carbon footprint measurements, how are we achieving carbon neutrality?
How are we measuring water use and waste?
On the topic of our environmental narrative (which everyone has seemed quick to develop), do we have metrics to back up our progress?
Social:
How are we measuring the achievement of diversity in our organization?
How is management impacting the processes that result in those outcomes? Are they examining opportunities for promotions, especially into positions with profit and loss responsibility?
What is our impact on local communities?
Do those in our supply chain reflect the values of our organization?
Governance:
Do we have transparency on how our board governs?
Have we set targets on board diversity?
Do we have the right set of skills in our boardroom to provide the best independent oversight of the organization and its strategic imperatives?
Is there transparency in and a performance orientation to the compensation structure for the CEO and executive leadership?
Are our compensation practices aligned with investor and stakeholder interests?
Companies’ Progress on ESG
Over the past year, increased investor, activist, and regulatory focus has resulted in significant progress by many boards relative to ESG. Of 456 new directors who joined S&P 500 boards in the past year, 72 percent are women or people of color. Meanwhile, major oil companies, for example, have shifted strategy relative to net-zero carbon emissions targets and investment in alternative energies.
Some of the largest car manufacturers have declared electric vehicle production goals. Many corporations—across numerous industries—have committed to significant investment in historically Black colleges and universities and community programs to serve underrepresented populations.
There is no doubt that the private sector is accepting a larger role in creating opportunity and equity across our society—particularly during a time when the pandemic has highlighted inequities of access.
Avoiding a Confrontation
For boards wishing to avoid an Exxon-type confrontation with investors, our panelists offered the following advice:
Actively engage in conversations with shareholders. The days of keeping board directors away from shareholders are over. It is particularly important for compensation and nominating and governance committee chairs to engage with key investors in order to create a common understanding of various ESG concerns and to demonstrate transparency in the board’s oversight of strategy.
Focus significant energy on the firm’s capital allocation. How much money is spent on maintaining legacy strategy, and is there an appropriate amount spent on innovation? A strong narrative around the capital allocation strategy can put investor concerns at ease if they believe the board is focused on the company’s future impact.
Remember that having a good narrative is important—but not enough on its own. If the company wants to make a commitment, be sure that it’s backed up with facts and measures. Empty promises can easily be called out as greenwashing.
Don’t underestimate the impact of passive index funds. They are entering the ESG conversation and can play a big role in shifting not only funds but also mind-set.
A decade from now, we will look back on the 2021 proxy season as a pivotal time in corporate history. Shareholders are now holding boards accountable for the wider environmental and social impact of enterprises—and they are willing to challenge any director they deem unfit for this new purpose.
Looking Backward and Forward
As I sit at my gate today for my first commercial flight in over a year, I'm reflecting on the past year -- a year when we all had to deal with unexpected crisis, losing the freedom to visit with family and friends as we wished, learning to connect with colleagues over technology, and even establishing new relationships with people who we couldn't meet. It's been a year of constant adjustment, learning and re-learning, adapting, and having gratitude for the little things we might have taken for granted.
As leaders, it's been a year of tremendous learning and growth. We have learned to trust people whom we've never met. That eyeball-to-eyeball connection that many of us thought we had to have was impossible in most situations. But somehow, we welcomed new members to the team, took advice from experts on Zoom calls, and even provided support and much needed encouragement during a difficult year of loss and absence.
We learned that work-from-home, although not ideal, was something that could be done. As one who fought for work flexibility for years, I was heartened to see quite a few naysayers come around to the fact that productivity didn't go down just because there was a load of laundry in the wash, and seeing someone's dog, cat, or child didn't reduce professionalism. As we return to an office environment - perhaps in a different form - may we carry forward this refreshing appreciation for one another's full lives.
Technology got a power boost! With the ease and acceptance of virtual meetings, those who are working on even more interactive forms of communication got the "go ahead" to push innovation even further. It won't be too long before we can be "seated" side by side with one another and sharing virtual whiteboards from any location around the planet.
However most of all, I've missed everyone. I'm about to board a flight to D.C. to meet two people for dinner tonight whom I've only ever met virtually. The good news is I've liked them enough to want to meet them and talk about future business opportunities. The best news is we are going to actually have dinner together.
I've appreciated the past year -- the sacrifice we have all been willing to make in order to keep one another safe, the ability to spend so many consecutive nights sleeping in my own bed, and the chance to bring two puppies into our home, read some books, and stream loads of programs across digital platforms. But most of all, I'm glad we're emerging back into a world I've missed and giving/getting hugs once again.
Stay well, everyone!
College Advice and Business Reflections
I had the pleasure of hosting a virtual event for my college alumni club today. Every summer, at about this time, Joel and I host a pizza party inviting all of the Houston-area freshmen preparing to attend the University of Illinois at Urbana-Champaign to meet one another as they get ready to head for campus. It also gives them a chance to meet local alumni group officers to ask questions in preparation for their upcoming experience. Given that we are living in the world of COVID-19, this year’s event was held in the Zoom Room, of course. Of the 18 new students attending UIUC this year from the Houston area, we had only three who could join us, but with 5 alums also on the call, it was a wonderful conversation we shared for about an hour.
After the requisite brief introduction by all participants, we opened up for questions from the students. Every year when this event occurs, I find myself mentally wandering back in time, thinking about how scared I was heading out of state to a university of about 40,000, where I wouldn’t know a single undergraduate student, and starting a new chapter of my life. And every year during the conversation, I find a yearning to return to campus and having a chance to relive that wonderful chapter all over again!
The students’ questions this year covered a broad range of topics: What electives did you take? Where did you study? What do you think of study abroad programs? How many years did you live in the dorms? What meal plan do you recommend? How heavy of a coat should I take (extremely important when you are from Houston!)? Where did you hang out in your free time? It was enjoyable for the alumni on the call to spend some time reminiscing as our time away from campus life ranged from single digits to over 40 years!
In the final minutes of the call, I asked each of the alumni to give one bit of advice – with the advantage of having 20/20 hindsight – based on anything they wish they had done more of (or less!) during their time on campus. I found the reflections poignant and sensible, and definitely advice I wish I had received when I first ventured away from home for college. Not surprisingly, I realized much of the advice can be equally relevant to how leaders at any stage in our careers think about opportunities and circumstances as we move through our different life chapters.
Be prepared to work hard to stay on top
The advice to the students was to realize that even though they might have been one of the smartest kids in high school, they need to understand that the definition of excellence was about to be reset. The difficulty of acceptance into UIUC’s Grainger College of Engineering (they are all engineering majors), means they are about be surrounded by some of the brightest minds from all over the US and abroad. The importance of being prepared and diligent, staying ahead on coursework is key to excelling in college.
The parallels of this advice for leaders are great. Leaders who fail to recognize the importance of continued learning and improving skills are sure to far behind. The work only begins when you land a new job. Particularly in the environment of constant change that we find as the new normal, the importance of this advice cannot be underestimated. Staying still today means falling behind – quickly.
Trust your intuition, but don’t rely solely on it
The advice to students was that although being good at thinking on your feet and figuring things out on the fly might have worked in high school, not being organized in your daily college life will backfire. You can’t rely on just figuring things out – you need to be deliberate about applying discipline to everything you do.
The importance of balancing intuition and disciplined information-gathering is key for any good leader. Instincts are important – especially when it comes to reading a room, sensing a challenge emerging, or even in problem-solving when something just “doesn't seem right”, but great leaders understand the importance of being disciplined in gathering data, learning the facts, and preparing thoughtful steps in executing strategy.
Study (travel) abroad
The question of whether study abroad programs are worthwhile always seems to come up when speaking to rising college students. It’s wonderful that many universities are encouraging undergraduate students to have this experience as such programs grow the student in both a professional and personal capacity. The advice given was to definitely pursue an opportunity, consider appropriate timing (in the context of requisite coursework), and to start planning for it early.
The importance of business leaders having a global perspective is paramount – whether or not you run a business that goes beyond your country’s borders. The impact of global events and disruption plays a huge part in managing everything from supply chain to reputation management. Geopolitical imbalances, unexpected natural disasters or pandemics, and military insurrections can quickly change an organization’s ability to operate successfully. Increasingly diverse workforces call for leaders who are enlightened about ethnic and cultural differences. With the rise of the importance of ESG and in the world of instant communication, naiveté about global issues can have irreparable consequences.
Find opportunities for experience beyond just classes
At a university as large and diverse as UIUC, the experiences that await incoming freshmen are almost more than one can imagine. We recommended that in this unique time of life – when you have a sole purpose of learning – that students take full advantage of resources and opportunities available. Taking a diversity of elective courses, meeting different kinds of people, and allowing yourself to be truly “who you are” and not living up to a set of artificial expectations are important during the college years.
For too many leaders, intellectual exploration ceases when they begin a professional career. It becomes far too easy for executives to be comfortable in their habitat and surround themselves only with the “job at hand”. They fail to venture outside where there is more to learn, and where the options for solutions are far greater. Leaders who fail to grow beyond their job descriptions suffocate innovative thinking and weaken both peripheral vision and the ability to see a future that might be different from where they stand.
Be aware and take advantage of brilliant people who surround you
Recognizing the importance of relationships and networking, my one regret was not taking advantage (perhaps not truly valuing) the tremendous amount of brainpower that surrounded me during my time at UIUC. Failure to seek wisdom of professors during their office hours and not having more conversations with advisors (other than figuring out how many more credits I needed for graduation) are my greatest regrets from my college days. As I look back now, I realize that at any given time at UIUC, there are more than a handful of Nobel laureates or Pulitzer Prize winners teaching on faculty, and brilliant adjunct professors who have extensive experience running businesses. Too many students go through their college years without tapping into perhaps the greatest resources that universities can offer.
In the business world, we know that it’s all about relationships and tapping into expert knowledge. The amount of thought leadership that is available today through publications, podcasts, and video recordings is endless. With the convenience of the internet, it is virtually impossible to find the answer to a business challenge that someone hasn’t at least thought about or actually experienced first-hand. Similarly, great business leaders understand the importance of capitalizing on their personal networks. Nothing can easily be accessed without someone opening a door. The better you know an individual, and the more you have invested in that relationship, the quicker someone is willing to reach for that door handle to help you out. I find that the common expression of it being a “small world” is due to someone who has invested in their network over many decades.
As the Zoom call ended today, I’m sure the alumni on the call felt as I did; that they would like to take some time to return to the life of a university student, knowing what we know now. Upon reflection, however, I realize that we always have the ability to take the advice we gave to the 18-year old rising freshmen and apply those lessons to our everyday lives. Go Illini!
Positivity
In conversations this past week, I was asked by three different people, “How are you staying so upbeat and positive with everything going on?” It was an interesting question, and when I was asked for the third time, I realized it was worth thinking about. Life is a challenge these days as we face a pandemic, racial strife, economic downturn, energy industry impact (I live in the Houston area), ugly politics during an election year, etc...and yet I’m feeling pretty positive and hopeful.
No, I haven’t taken to drugs or increased my alcohol consumption, nor have I crawled into a hole and avoided reality! But in the past few weeks, I have made it a point to take some deliberate actions to stay positive and hopeful. I realize that I impact not only the mood of my household, but as I serve on boards and speak to numerous executives and thought leaders across industries during the day, I impact many who all benefit by hearing more words of hope and optimism as they navigate challenging waters.
As I think about what I’ve done to stay “above the muck”, these are some practices I’ve adopted:
Understand my role in this pandemic
I’m not an epidemiologist, health care worker, nor do I work directly in the healthcare field. I have no expertise about this virus. My role is as a citizen. I have a healthy respect for this virus, understanding that although the vast majority of people who come in contact with the virus do alright, I’d rather not contract it, nor do I want to give it to someone inadvertently. As a result, I stay home as much as possible, and when I go out, I wear a mask.
I do not need to know absolute daily numbers of how many people test positive or how many have died in every state or country. I have a good general idea and know where trends are heading. Therefore, I don’t spend time worrying about what mistakes were made yesterday, which political camp is inflating or deflating statistics. I adhere to guidelines prescribed by experts and follow local authorities. I pray that really smart people are working on a vaccine but know it might take time.
I also know that information is readily available. There are reputable sources that are publishing these, so I don’t need to be the 500th share or tweet to inform.
Limit my media consumption – particularly social media – particularly Facebook
In case you didn’t notice, news is depressing. As a result, I don’t consume more than I need. I watch/read enough to carry on conversations with people so that they know I’m not a luddite, but I don’t need to debate things that (1) won’t change or (2) people really don’t care what I think about. I do continue to maintain deep knowledge about the topics for which I care and understand, and I am cognizant about topics on which my opinion matters. I’ve also discovered that picking the right forum to espouse my thoughts is important if I want to have a constructive conversation.
As the forums go, Facebook has become the most depressing. I joined years ago to get in touch with old friends and catch up on one another’s lives. My “memories” lookback shows how my involvement on this platform has evolved. Having gone through the stage of “cute kids” and “parental bragging rights” – I still love my kids but they’re adults now so they’re on their own to talk about how cute they are – I’m now in a life stage where I have this strange dilemma of “what do I tell people about”. Realizing it’s easy to fall into the narcissistic habit of asking people to “like” my life, I’ve found myself posting far less than I did years ago.
So on the topic of how to stay upbeat, I took the FB app off of my phone and iPad (leaving Messenger on because I have people in my life who use it regularly). When I do get on via my laptop, I allow myself to scroll until the first negative/critical/lecturing comment about ANYTHING, and shortly thereafter, I close the app.
Generally, my scroll time is about 30 seconds.
I don’t have the time or energy to engage in debate with people who don’t want to hear contrarian views, and I find myself starting to dislike people I actually thought I liked. I love informative posts – news and updates – but I cringe when people are directive and condescending. I found many posts/comments around racial equality to be tremendously insulting and hateful. I’d never before seen the level of vitriol and resentment on the site. I know I’m missing cute kids and puppies, but it’s okay…I catch them if they appear on my scroll above the hate and negativity, and the lack of my “like” doesn’t make them any less special.
It’s not that I don’t have an opinion on important matters, but I don't think I’m going to change anyone’s opinion on masks, politics, ethics, diversity, or sustainability on Facebook. Change happens in real conversations and social media is not a real conversation. Real conversations have consequence and dialogue; if I say something negative, I have to answer to a response. People don't have to do that online; they can anonymously call someone an idiot, and never have to answer to their victim. The danger of those comments and headlines getting shared over and over gives people the impression that the majority of the human species are jerks.
I don’t believe we are.
For my needs, I find LinkedIn to be a much better platform for sharing/receiving thought leadership. It hasn’t been taken over by people who want to name-call or lecture. On the few occasions I’ve seen it, people are quick to call out inappropriateness, and it seems to work. I find for my blog posts LinkedIn garners many more comments, shares, and suggestions, and is (unsurprisingly) reaching an audience that cares more about the content.
Look for goodness and beauty
You don't have to look too hard to find great stories that are taking place these days in spite of our challenges. Gestures of caring for the elderly, the amazing innovations happening on so many fronts, stories of survival, and overcoming incredible obstacles give me strength and affirm my belief in goodness. Those are most of the stories I choose to share.
In nature I find beauty and amazement. Finding live video streams of animals in their habitat or of nature walks and majestic mountains remind me of the amazing planet on which we live. Taking a walk and noticing animals and birds in my neighborhood gives me a sense of gratitude that I get to quarantine in a beautiful environment during the pandemic.
Find time to do new things
In spite of more hours on videoconference calls and in meetings, the inability to travel and my reduced online hours have yielded a windfall of free time. As a result, I’ve increased my book reading, piano time (re-learning some old and learning some new), bike-riding (before Houston summer temps arrived!), and I’ve fallen into the great habit of getting in touch with old friends by phone – since everyone is home and easy to find!
All of those activities result in far more positiveness than negativity.
One of the most important attributes of strong leadership is to maintain a positive and inspirational outlook in challenging times. Being deliberate about understanding our sources of stress and scaling back on activities that bring us down is vitally important. That helps us focus on aspects of our lives that bring feelings of happiness and gratitude from which others can draw hope and inspiration.
Give yourself a break from too much bad news and social media. Look for goodness and beauty. Find old and new and fun things to learn and do. Get in touch with friends and people who will lift you up. The magic formula is in there somewhere!
A Time for Shift
The death of George Floyd has once again brought to light the topic of race, power, and bias in a nation whose strength has been built on peoples of difference. Although focus and protests are mostly around the institution of law enforcement, conversations for many have moved onto the general topic of inequity that continues to permeate all aspects of our society – families, neighborhoods, educational institutions, and business.
The greatest danger we have is that we fall back into what I call the “outrage-to-indifference” cycle that we have gotten to know all too well. When the protests subside, broken retail stores restock and reopen, social media profile pictures that were briefly turned to black return to selfies, and hashtags disappear, we once again slide into the status quo of our familiar lives and conversations. Those in power remain in power, and those who struggle find that nothing has changed.
That is the cycle that must be altered.
I have spent the past three weeks listening to individuals across my network – current and former colleagues, dear friends, and leaders in the business community representing the public, private, and not-for-profit sector, to inform my perspective on the topic of racism that continues to impact our society. I have been tremendously heartened to hear every leader speak of how things must change, and that they need to be part of that change.
In addition to the community, educational, governmental, and justice system institutions that need honest examination, business leaders have clearly stated they want to examine how it feels to work in their organization. Many are asking “What should I do?”, and genuinely want to shift the trajectory of an all too ossified curve that continues to favor one group over all others. Many are reflecting on what has been done in the past to engrain unconscious bias into systemic divides. Many are examining their own behaviors.
From these conversations I’ve gleaned some insights into what business leaders can do:
Communicate. Your employees are listening and hearing your words. They are also hearing your silence. In an environment of unrest and uncertainty, it is essential for leadership to double down on values and commitment to an equitable workforce culture. Many organizations have stated values that they espouse, but words are often hollow and not genuine. Messages need to represent authenticity and be founded in a commitment to grow and learn. The future must represent inclusion, not just diversity.
Provide a platform for dialogue. Create space for people to talk, and more importantly, to listen. Black employees need to speak and to be heard. They need to share how they are feeling, what they have experienced, and why they feel the way they do. This is vital to grow understanding and empathy. Listen to stories of injustice, prejudice, and what they have experienced. This is vital to defining a way forward. Most importantly, hear how it feels for them to work in your organization. Hear of the impact of having significantly more challenges and lack of mentors and role models. Hear whether they believe there is true opportunity for advancement and whether they feel support to learn and grow. Ask for stories. They tell the most.
Don’t broaden the topic. Don’t turn this dialogue into a conversation around inclusion of all groups. Just for now. Nothing is more irritating to an individual who needs to talk about one problem than to have it diluted by becoming part of a larger one. Focus on the topic of black America. Focus on what is distinctively different about what it feels to be black in your company. There is a difference. Of course it's a broader topic, and inclusion must include people of all demographics. But by broadening the topic, we make the conversation more comfortable, and we need to stay in discomfort in order for change to occur. By broadening the topic, we also become distracted by the bigger problem, and we miss out on addressing the things that are needed to change.
Examine internal processes and systems. In order to understand how bias plays into decisions of advancing or providing opportunities, leaders must investigate how these factors contribute to the lack of/stunted advancement of black employees in their organizations. In most companies, there is adequate representation at entry level positions, yet as we look at higher level jobs, representation diminishes tremendously. Selection processes designed for equity are most likely impacted by unconscious bias of selection committees.
Over the past 17 years, I’ve served as an independent director for 9 public companies. Across these boards, I’ve served with only one black director. This is tremendously unacceptable. In recent years, there has been an increase in women in boardrooms, but I’m not naive enough to think that would have happened as quickly without public attention, legislated requirements, and ultimately, investor pressure. The challenge of breaking the status quo is undoubtedly helped with policy reform. However, to achieve sustainable change, it is imperative that people in power understand the value of inclusion and involvement that originates from all sectors of our society.
We have a choice. We can choose to let this conversation wither over time, or we can choose to own part of the problem and make a difference in our own organizations. Waiting for society to fix all of the underlying problems in order for the solution to magically occur is an excuse to ignore. Business leaders are solely responsible for how it feels to work in your organization.
Business provides hope and opportunity to change lives for people in our communities. We are responsible for making sure that hope and opportunity exist for all.
Emerging from a Pandemic
The pandemic of 2020 will be remembered and studied for generations to come. Long after the political battles are fought and won, historians will study what went right, what went wrong, and who were the heroes and zeroes. As we begin to consider the “when” and “how” of emerging back into a normal world, we have a unique opportunity to reflect on what we’ve experienced during this pause. To what behaviors will we revert, how many new habits will we retain, and what opportunities are there to revisit how we interact with one another in our communities, and in our places of work?
It would be a shame if we behaved as a stretched rubber band and merely snapped back into the shape we were in before this crisis. As I recall, the pre-pandemic era wasn’t exactly utopian, filled with generosity and thoughtfulness. It certainly wasn’t devoid of stress. By the time it’s all said and done, the pause will have been long enough to have significantly altered daily routine, helped us discover new technologies, and will have given many of us a chance to revisit practices that we had long forgotten, or perhaps had gone dormant in a busy and hectic life.
The Planet
There have been obvious impacts on our natural environment. As parts of the world shut down, we witnessed the improvement of air quality. We’ve seen pictures of large metropolitan cities in China and the U.S. with clear blue skies. Fish can be spotted in the canals of Venice due to reduced water traffic, and mountain ranges in the Himalayas are visible for the first time in decades. As economies reopen, much of this might disappear, but it’s nice to know that nature can recover, and we can influence our environment in a short period of time. How much does this realization fortify our positions around the energy transition and how we behave in our daily lives?
Our Home Life
In our neighborhoods and at home, pastimes like bike-riding, after dinner strolls around the neighborhood, and old-fashioned phone calls with friends have been rediscovered. Families are sharing regular meals together again. With children schooling from home, parents telecommuting, and restaurant dining facilities closed, the practice of home-cooking re-emerged out of necessity. We are sharing recipes over the internet, planting “Victory Gardens”, and watching viral YouTube videos for at-home haircoloring and haircutting. Perhaps as we “return to normal”, we will be able to capture and retain many of these wonderful old, yet new, traditions.
Business Observations
As a business leader, I am particularly interested in how this pandemic has influenced the private sector – both the short-term consequences as well as long-term implications. An unexpected/unknowable event, known as a “Black Swan”, creates unprecedented challenges for a generation of executives. Keeping business afloat, preserving supply chains, retaining employees, and calming stakeholders are some of the greatest challenges we face, yet the situation also offers an incredible platform for leadership and inspiration.
Generosity and Agility
Not surprisingly, as in most crisis situations, this pandemic has revealed incredible levels of generosity and agility in support of the greater good. In the midst of plummeting market values, companies shifted manufacturing lines to make medical equipment. Pharmaceutical firms abandoned projects of great financial incentive and focused on creating virus tests. CEOs and executives took massive pay cuts to avoid layoffs and furloughs. Rents and mortgages were forgiven, and insurance premiums were cut. As companies examine these decisions, there is no doubt a disconnect between what is “right” and what is “rewarded”. In times of crisis, “right” easily wins out. This prompts questions of structure and incentive. How can supply chains be modified to create more agility in turbulent circumstances? How do we make doing what’s “right” part of the performance equation against which companies are valued by investors? Can it be defined and measured through the impact of an Environmental, Social, and Governance strategy?
Supply Chain
During the pandemic those who had flexibility in their supply chain found themselves at a competitive advantage as options narrowed quickly. In the push for maximizing cash and working capital positions, many companies have learned that reducing supply chain optionality too greatly proved to be a significant constraint. As we emerge back into a more normal cadence of business, it will be interesting to see if supply chain flexibility becomes more important than supply chain efficiency. Do you want to have all your eggs in one or two baskets? What are the implications of geographic sourcing? Are there countries that should be considered higher risk based on how they behaved during this crisis? Should you consider lack of flexibility as an enterprise risk?
IT Investment
The pandemic pushed many out of their comfort zones. Executives who once depended on IT specialists and administrative assistants to cue up their computers for conference calls had to figure out how to download software on laptops and mobile devices to access Zoom, Bluejeans, and WebEx platforms at home. (It’s evidently never too late to learn, even for mature executives.) As technology played a huge role in how businesses adjusted to the sudden change, it was clear which companies invested in IT infrastructure, and which ones ignored that inevitability for too long. How will companies assess their business resilience going forward? How will companies prepare their systems for the next pandemic or crisis?
Travel and Commuting
The curtailment of normal business activity yielded changes to routine that we seemed to follow in lemming-like aimlessness. Air travel came to a standstill as countries were shut down and offices closed. Daily commuting via trains, buses, and automobiles came to a virtual stop. In the period of two weeks, business was being conducted over video and conference calls. It begs a thorough examination of the resources spent on travel and meetings. Do we really need to travel by plane as much as we did before? For groups that meet quarterly, can they consider that one of two of those meetings a year be covered virtually – saving time and resources for both planners and attendees? What impact does this have on industries that count on the volume of business travel that might significantly decline?
Telecommuting
Many managers who place importance on “face time” and doubted the effectiveness of telecommuting have been proven wrong. Most new telecommuters feel that rather than be distracted by household chores (although it sure is nice to be caught up on laundry), they have never worked longer hours or harder than they have during the COVID-19 crisis. As a result of the pandemic, many companies have now invested in IT infrastructure and security measures that allow efficient and secure telecommuting. In addition to potential commercial real estate expenditure savings and efficiency to be gained, there is the collateral benefit of more flexibility for which many have pushed in the struggle to balance demands between work and home. Can the work-from-home phenomenon be more commonplace than exception? How do organizations create a strong culture, team orientation, and talent development with highly flexible work arrangements?
Moving Forward
The difficult decision of how and when we open our markets and countries must be made by government officials, informed by scientists and medical experts. However, the conversation WE can all influence is how we want to define the world in which we raise future generations. As human beings, we are social animals, and we’ve missed being together. The ability to pass the time with family and friends, dine in our favorite restaurants, and attend performances and sporting events were activities we perhaps took for granted.
As we shift toward a post-pandemic world, we will strive to regain those experiences in a safe and deliberate manner. However, how can we adopt some of our “new practices” as we redefine interactions in our cities, communities, and workplaces? Can the kindness and generosity we have witnessed during this pandemic be retained in our families and communities? Can the flexibility and compassion our companies have exhibited be measured and rewarded in our organizations? Do we take this collective global pause as a lesson in humanity or merely an inconvenience in a world model that was certainly not utopian?
It seems there’s a huge opportunity to do so.
Implications of Social Distancing on Leadership
In the midst of the unsettling world of COVID-19, people are finding themselves in unchartered territory. Restaurants are shuttered, schools are closed, sports and performing arts events have been canceled, and routines once defined by daily human interaction now rely upon technology to stay connected. The term “social distancing” is now a part of our collective lexicon, and “quarantine” is used to connote both protection and prevention. The vast majority of the population is practicing behavior for the collective good; reducing our contact with other humans mitigates risk, particularly for those most vulnerable to the disease, and gives our health care system the greater ability to treat those affected.
As I spend my days in virtual board meetings, we discuss topics of business continuity, community outreach, employee/contractor assistance, and safety in the workplace. In spite of a collective concern about world markets for an unknown period of time, I’m heartened to hear compassion and integrity from CEOs, executives, and board directors focused on doing what’s right. But while I listen to these productive conversations, I can’t help but think about new challenges that are emerging in our connected-but-isolated world.
The novelty of a “shelter-in-place” environment creates a new reality with immediate upsides. Air quality is better, Venetian canals are clear enough to see fish, and we aren’t spending as much money on commuting or eating out. But as the novelty wears off, leaders both in their workplaces and in our communities will face a different set of challenges brought about by the lack of eyeball-to-eyeball interaction, and the impact of leadership will become more important.
Inside our Organizations - Creating and Sustaining a Healthy Work Culture
The work-from-home (WFH) phenomenon is new to many. Those who grew up with a model valuing “face time” may find it difficult to imagine that any real work can get done outside of the office. They may be aggravated to hear the dog barking in the background of a conference call or roll their eyes to see a toddler running into mom’s or dad’s office during a video conference, but they are in the minority. Most people are not only fine with this business approach but perhaps saying, “It took a pandemic for my boss to trust that I can get my work completed while a load of laundry is also getting done”. In some ways this could be a bit of a welcome break. With a reduction in long commutes, and increased time with family at home, “work-life balance” is becoming more manageable as the two entities blend together. Meetings are more efficient with people less likely to pontificate on a conference call, and experienced telecommuters know that socializing only happens if you dial in five minutes early.
One thing that may suffer, however, is organizational culture. Culture defines how people act, how they resolve conflict, whom they trust, and to whom they turn when challenges arise. Strong cultures are built when people have shared context, form relationships, solve problems, and learn acceptable ways to react to both verbal and nonverbal cues. In great organizational cultures people show they care, take time to listen, and reach out to one another in times of personal stress.
This is tough to sustain over a long period of social distancing. How will people stay connected to one another? Will they still feel part of a team if they don’t see one another regularly? How will they know the financial health of the organization? Will they worry about their jobs? During a time of crisis, leaders spend a great deal of time with their boards and executives keeping business on track and taking measures to mitigate risk. However, as the period of uncertainty continues, they and their teams must be able to take the pulse of the wider organization.
Things to do:
Provide context. Hold virtual town halls. People need to see their leaders during times of uncertainty! Providing people with information about what the company is doing to stay safe, work with customers, and help in their communities will keep employees engaged and connected. If possible, open up to Q&A, allowing employees to ask questions in real time. By using technology, there is safety in the anonymity of questions being asked during difficult times.
Communicate your actions. You are doing things in a crisis. You may need to tighten controls, reduce variability, manage your brand. People may not understand until you let them know why, and your actions can easily be misconstrued when you alone are privy to information. Take time to share and bring the team along.
Look in on employees who are new to the company or to a job. Nothing is worse than joining a company, or being sent on a new assignment, and then not being able to integrate. Check in with those who are still learning the ropes and make sure they feel looked after.
Create virtual social get-togethers. Many organizations are holding virtual happy hours, celebrating milestones, and recognition events. Share how your organization is working with the community during these times. The importance of social interaction is part of a healthy culture and breeds trust and familiarity and can spur innovation.
Outside in our Communities – Looking out for the Isolated
In our wider community, social distancing exacerbates the isolation of many segments of our population. Nothing can be more frightening than living through uncertainty alone. Whether they are young adults living alone away from families, single parents bearing the weight of raising kids on their own, or seniors living in isolated communities, this is a time of great stress and loneliness. In spite of the availability of television shows, podcasts, and social media, a world without positive human contact can be debilitating. In the interest of preserving physical health, we run the risk of creating a mental illness pandemic.
Particular groups at risk:
Senior citizens. Those who are living alone in their homes or in senior care facilities are likely experiencing the greatest level of loneliness in their lives. Many senior care centers are no longer holding meals in common areas, and having people dine in their rooms. With visitors not allowed, they are effectively confined prisoners in facilities. The added complication of dementia in the senior population creates even more confusion and misunderstanding on the part of residents, and frustration and stress for their caregivers and facility workers.
Caregivers. Whether they are taking care of special needs children, an ailing spouse, or elderly parents or friends, they will be particularly stressed. The ability to find respite in the current environment is virtually impossible as change to regular routines of eating out, visiting activity centers, or going to the gym have all been disrupted. Offering to run to the store or have a meal delivered can go a long way to provide support and friendship.
Children. Regardless of how much kids enjoy time off from school, the sustained change to that familiarity and routine is unsettling. As much as kids pick up cues from their parents, there is likely a degree of stress and fear that they are not expressing. Spend time allaying their fears and find projects to help others.
For leaders, this surreal temporary world brings new challenges to organizations and our wider society in the coming weeks and perhaps months. As social distancing impacts a cohesive work culture, it also impacts those who find themselves living in isolated environments, experiencing tremendous stress and loneliness. As medical experts seek resolution to the virus, great leaders in organizations and in our communities need to think about how to combat these social challenges. As we create distance for physical health, we must remember that isolation threatens the very thing that makes us uniquely human – the ability to interact with one another through friendship, empathy, and compassion.
Leadership in Innovation and Humanity
Last month, I completed an incredible week of brain stretching. On September 17-19, we held the annual TWIN Global conference in Chicago, a carefully curated event of 300+ top leaders representing corporations, entrepreneurs, nonprofits, academics, military, and the arts. We gather annually to explore, debate, and dialogue about how to achieve global prosperity through the exchange of ideas, and forging unlikely collaborations. When that concluded, I flew to Washington D.C. to attend the annual NACD Summit, a gathering of over 1,500 board directors who discuss and improve our knowledge about board governance, and challenges that face leadership in public, private, and nonprofit organizations. At the end of the week, my brain felt as though it was going to explode. At both events, a terrific lineup of topics, presented by engaged speakers and attendees, perturbed and challenged my paradigms. It was a healthy dose of innovative thinking as I consider my role in board leadership and business in the coming years.
The topic that was common throughout both conferences was the pace of change and disruption that we will undoubtedly experience in the next decade. As we consider innovations in technology, data collection and management through AI, speeds of communication through 5G, automation through robotics and drones, and increasing technological advancements in bioengineering and medical breakthroughs, the potential of progress is tremendously exciting. However, we also took sobering stock of a global backdrop of geopolitical conflict, heightened religious fractioning, an increased disparity of wealth, growing distrust of establishment, and a continued shift in the climate of our planet. These factors contribute toward a significant increase in discord and conflict.
In many instances, the elements of innovation that excite me seem to be the very topics that cause concern. Technological progress is inevitable, but will we be able to handle it properly? Underpinning my consternation is the belief that unless we share a strong set of values in our collective humanity, we are headed for a future we won’t want to see.
Collection of data can be tremendously positive when used to compare research results in fighting diseases such as cancer and Alzheimer’s. However, Facebook and Cambridge Analytica taught us that misuse of data collection results in biased actions and infringement on personal privacy.
3D printing can enable efficient delivery of products in real-time environments, eliminating cost and time constraints of production and shipping. However, it can also be used to print weapons to avoid required registration, or products that fail to meet quality standards.
Robotics promises to take the place of humans performing repetitive and dangerous jobs, and in places that are difficult to access. However, they could displace significant sectors of the population, creating large groups of unemployed workers who are not adequately trained for other jobs.
AI technology holds the promise of improved forecasting of natural disasters, enhanced automation, and elimination of human errors. However, misuse of AI can also facilitate creation of more deep fake videos, and dangerously biased AI modeling.
In all industries, technology can be the basis for improving our world. In consumer-facing industries, we’ve already seen the impact that it has had on the retail, communications, and home entertainment worlds. Amazon, Apple, and Netflix have redefined many of our day-to-day habits, and have created more opportunities for people to access products and services previously out of reach. In the industrial segment, technology will increase use of data and reduce cycle time as well as the need for humans to perform dangerous tasks. However, in a society void of fairness, compassion, and respect for differences, the malicious use of technology can be destructive in the hands of those focused on furthering positions of power, politics, and greed.
The importance of continuing to build fairness, compassion, and empathy in our educational system, mentoring efforts, and in our private and public sectors takes on an elevated level of importance as we move forward in this world of unprecedented change. Leadership becomes even more important as we balance the progress of technology against the backdrop of humanity that makes our species so special.
S&P Milestone
It was announced this week that the last of the S&P 500 companies that had an all-male board named its first female director. Although this news might seem ridiculously mundane prompting an “it’s about time” reaction, to many of us who have been pushing for the advancement of women in the executive suite and boardrooms, it seems like someone, somewhere, should be ringing a bell.
A news article said that earlier in the year, the Washington Post singled out Copart for being the last company in the stock market index to be gender-homogenous. At the time of that call-out, Copart indicated that it was planning to add a “highly qualified, accomplished woman” this year. I’m so glad they made this clear because I’m sure the company’s shareholders would be tremendously upset if they felt that “any woman would do”.
The often-made comment that women who are being sought for board service need to be “highly qualified” is an indication of a bias (and I won’t even call it unconscious) that in order to increase diversity and to be more inclusive, a bar might need to be lowered to get that done.
There is nothing that can be further from the truth.
It also assumes that every man sitting around the table is there because he is “highly qualified and accomplished”.
I have witnessed a few exceptions to that assumption.
In over fifteen years of board service on public companies, I have worked with incredible men and women dedicated to organizational oversight and stewardship. Most boards are made up of individuals who bring unique skills and backgrounds that gives them a perspective that is valuable to the company's strategic challenges. On some boards, there is sometimes a person who shows up, rarely says a word, and whose voice is only heard when a motion needs to be made or seconded. I’m never quite sure why they are there, and hope that perhaps in between board meetings, they are somehow adding value and helpful counsel to the CEO and leadership in another capacity. Short of doing that, I think of these as “taking up space” directors who need to be removed through good governance and strong board leadership.
I can honestly say that I have never seen this trait with female directors. The women with whom I serve on boards have always “hit the ground running” making a substantial contribution from the first day they are at the table. In large part, this is due to the hurdles we had to overcome on the way to becoming “highly qualified and accomplished” during our executive careers. Regardless of the industry from which we hail, we had to learn to be heard, overcome significant biases, and achieve results in spite of many odds and very few role models. For this first generation of women who are joining corporate boards, there is no doubt that by the time they pass the tribulations of their careers, scrutiny of executive recruiters, and interviews of nominating and governance committees, they will pass the test of being “highly qualified and accomplished”.
Hurray for the Copart decision, and for the S&P milestone that was achieved this week. May we always govern in a way that causes us to never doubt the qualifications of any public company directors – be they male or female – as the world continues to become more complex and challenging for public corporations. And may we eliminate the term “highly qualified and accomplished” from our lexicon in only describing board candidates who look different from the norm.