2018 was a busy year in America’s boardrooms, with directors dealing with big ticket topics such as board makeup and diversity and CEO scandals. But directors also took the time to share their insights with Corporate Board Member about how they do their jobs and what kind of mindset boards need to have in order to be effective. Check out this sampling of quotes from directors and experts focused on 2018’s front-burner issues:
California adopted new regulations in 2018 mandating at least two female directors by the end of 2021 if a company has five directors and three if the company has six or more directors. Violators face fines of at least $100,000 and up to $300,000 for multiple violations of the statute. Corporate Board Member’s Jeff Cunningham weighed in on the situation earlier this year.
“The warning has been a long time coming: board directors — relying on customary privileges like ‘choosing our own’ is going to be a relic of the past. Should boards refuse to put gender equality on the agenda until achieved, they can expect to be attacked, insulted, and boycotted.”
Bonnie Gwin, vice chairman and co-managing partner of the global CEO & Board Practice at Heidrick & Struggles, shared her thoughts on a hot boardroom topic in 2018—boardroom diversity and how directors are addressing it.
“One of the things that I’ve personally seen that really makes a difference is making diversity a priority from the top board leadership. It could be the CEO, it can be the chairman if she or he is a different person, it could be the chairman of nominating, it could be the lead director. But when someone at the top of the board, someone who is in a leadership position in the board says, ‘This really matters, we must make it a priority,’ I think you see a real change.”
After the salacious details of his X-rated shenanigans in the CBS C-Suite were revealed by Ronan Farrow’s New Yorker profile, Les Moonves had to walk away from his job as CEO this year. But just as the CBS board once ignored his misconduct, they faced a new distraction from the departed CEO—a public battle over his severance package.
“You do not need to be an investigator to question why a troop of young actresses march into the chief executive’s office for periodic visits of 20 minutes without any possible business reason to be there. You only need an astute and ethical board of directors, who know that truth is like a fountain, it keeps going up and up, until it goes out.”
Nokia Chairman Risto Siilasmaa shared his thoughts on why directors should open their minds and consider new ways of thinking about the future—even if a company is performing exceptionally.
“When your team considers only a single plan with no alternatives, alarm bells should ring. Not preparing for alternative scenarios – even the most unlikely ones – is a guarantee of being blindsided. Thinking in alternatives is not just about identifying options to an existing situation but about constantly imagining and manufacturing alternatives. By making this mindset part of your leadership team’s culture, you automatically start to come up with a higher number and wider range of alternatives.”
In addition to leading American Water’s team of 7,100 professionals who provide service to more than 15 million people, CEO Susan Story has serves as the independent lead director for Raymond James Financial, Inc., serves on the board of directors of Dominion Resources, Inc. and is on the board of the Moffitt Cancer Center and Research Institute Board of Advisors. Corporate Board Member caught up with Story to talk about balancing her responsibilities as a CEO and as a director.
“As an active CEO, before you ever go on a board, know that you’re going to put a lot of time in it. Number two, do you know some of the key executives, specifically the CEO, and do they reflect your values and what you believe in? And then third is, you had better be willing to do the very best you can and make sure that whatever board you go on does not put your company or your personal reputation at risk. I think those would be the three big lessons.”
Molly Hemmeter, CEO of Landec, a $500 million publicly-traded company that manufactures food and wellness products, also serves as a director on the company’s board, and spoke with Corporate Board Member about the collaborative relationship between the CEO and the board.