Around 50 per cent of international studies have failed to find a link between board performance and organisation performance.
Last year a contentious Australian study found that the introduction of independent directors has failed to deliver increased corporate value. Either the board model is wrong or the board people are wrong (or both).
In terms of people, boards are largely made up of incidental directors – well meaning, often highly skilled individuals who take up a board role incidental to their main career. They do not see the need to plan for that career, to train for it or to push themselves to peak performance on an ongoing basis.
The intentional (or career) director intends, plans and trains to be a director. We are only at the start of the intentional director revolution, but it is coming. Those who want directorships will need to be card-carrying career directors to get a gig in the future and in turn firms and stakeholders will be pushing that they add value to keep that gig. That’s when the academics will be able to provide the link that board performance equals organisation performance.
Authored by Andrew Donovan, Managing Director of The Director’s Suite