How effective is your board? Building leadership teams fit for the future
"We need to have those conversations now at the boardroom, and get used to feeling potentially deeply uncomfortable and having our own values challenged so that we can try and steer our organisations forward in the right way," said Jenny Robertson, managing director at Board Matters.
From filling "black holes" in Australia's board compositions to calls for more digital directors, questions over how governance structures can react to ethical investment priorities to what board diversity truly means, a recent webinar hosted by Business News Australia in partnership with OnBoard by Passageways addressed a raft of hot-button issues that have put leaders under greater scrutiny in recent times.
Adarsh Mantravadi of Passageways revealed findings from a recent Board Effectiveness Survey that identified enlightening statistics about board adaptation over the past 12 months, including the use of board technologies which - by their digital nature - open up to potential newcomers who have traditionally been underrepresented in boards to have greater directorship participation.
"Diversity goes beyond just being inclusive of race and gender, but also of the skillsets and even age, and many of the participants particularly noted the importance of trying to attract more diversity in the context of a younger demographic," he said.
"One opportunity to leverage technology is to take advantage of it to expand the reach where we have previously been focused in particular regions or professions for director candidates."
Calvin Stead, a turnaround and business growth expert who is currently the CEO of Kelly Engineering, admitted it was generally very difficult to find board members who didn't look like himself or fellow panelist Peter Williams, founder of the Australian Advisory Boards Institute.
"I'm very fortunate enough to run an organisation that is very diverse. It's got a wonderful cross-section of cultures, gender, age and is biased to the younger generation," Stead said.
"I still think you've got to try and find it [diversity] and maybe elevate it a little sooner and quicker through the ranks to harness the benefits that come from that."
For many leaders it can feel like a chicken-and-egg scenario - knowing that your board requires diversity, but struggling to find people with the right skillsets who either have board experience or are open to the idea.
"I think every board is looking to be diverse. The question is: how do they go about doing it?" asked Jenny Robertson of Board Matters.
"We don't have a gender issue, we have a leadership issue, so getting people to recognise that women might display confidence in a different way as opposed to men.
"We all need to be looking a bit harder at the people that we are shortlisting for our board roles and perhaps opening ourselves up to a little bit of more discomfort around the table," she said, adding directors with board experience could provide the "guardrails" for less experienced board members who nonetheless have useful expertise or perspectives.
Peter Williams explained advisory boards were one way to fill skills gaps, and he agreed that a shortage of younger people on boards was a major issue.
"I think that age diversity is something that is somewhat lacking, and that's usually because governance boards tend to choose for experience as distinct from enthusiasm and perspectives and the new world," he said.
"Governance structure around the world often lack the flexibility to innovate. They have been pretty much the same formats and styles for many years and so it becomes difficult to really get that whole mindset on a board changed to reflect the contemporary views [and] values that shareholders have.
"At the end of the day, to me what leadership really means is actually having clarity of vision, clarity of strategy, clarity of direction, clarity of communication."
But what happens when a prevailing sense of clarity about what makes a business viable and profitable is in direct conflict with what stakeholders want?
"It has to be addressed, you can't just hide it under the carpet. I guess that really comes down to the communication strategies. It's about listening to the stakeholders and making sure that their voices are still heard," Williams responded.
Stead explained misalignment between shareholders and stakeholders could make a board's job much more difficult.
"Until such time as the mandate is clear, you're going to struggle to find the right skills on a board because you're not terribly sure what mandate you want to actually deliver," he said.
"You've got to start at the shareholder group, making sure that there's alignment. Then you can get the board aligned and bring on the appropriate skills that are needed."
This is just a small part of the wide-reaching webinar "How effective is your board? Building leadership teams fit for the future". Click here If you would like to watch the webinar.