Den værdiskabende bestyrelse
Nye teknologier, forbrugervaner og forretningsmodeller ser dagens lys, og veletablerede virksomheder disruptes og rives op med rødderne.
Den fjerde industrielle revolution er over os, og hidtidige spilleregler og konkurrencepræmisser er ændret for bestandigt.
At håndtere disse konstante forstyrrelser er blevet en bestyrelsesopgave, og bestyrelsens sammensætning og kompetencer er derfor et tema, alle virksomheder er tvunget til at forholde sig til.
For spørgsmålet er: Har vi de bestyrelser, der skal til for at kunne navigere i en disruptiv verden, hvor viden om IT, innovation, forbrugertrends og nye muligheder for salg og marketing er alfa og omega?
Problemstillingen er højaktuel, og er også grunden til, at Henley Business School i samarbejde med bestyrelsesnetværket Board Networking afholder Masterclass under temaet ’den værdiskabende bestyrelse’.
Den internationalt anerkendte forsker, foredragsholder og forfatter, Professor Andrew Kakabadse fra Henley Business School er key note speaker på dagen, der også har indlæg af én af landet mest erfarne bestyrelsesformænd, Sanna Suvanto-Harsaa på programmet.
Kakabadse regnes blandt verdens førende eksperter i ledelse og bestyrelsesarbejde, og hans arbejde og foredrag er yderst eftertragtede og efterspurgt blandt verdens største virksomheder.
Vi mødte Kakabadse forud for Masterclassen til eksklusivt interview om den moderne bestyrelses aktuelle udfordringer. Interviewet er bragt i magasinet Board Perspectives og kan læses i modificeret form herunder.
Andrew Kakabadse: Professor of Governance and Leadership and Chairman of the Henley Directors’ Forum. Andrew joined Henley Business School in July 2013 after 30 years at Cranfield School of Management, where he finished as Professor of International Management Development and was awarded the honour of Emeritus Professor. He was inducted in the Thinkers Hall of Fame by Thinkers50 in 2015.
In your experience, what are the 3 or 4 most important factors which need to happen or be in place for boards to add true value to a company?
Critical for a board to add value is for board members to come to a clear and shared view concerning the competitive advantage of the firm on whose board they sit.
My research indicates that more than 85% of board members do not know, or do not share, a view on the competitive advantage of their firm
The reason for this is, lack of attention to how the organisation functions and lack of insight concerning the reality of how the culture impacts on strategy and the degree to which top management themselves are divided on strategy, mission and vision.
Further, most board members over-attend to their monitoring function, but do not spend enough time stewarding the organisation. Thus their out of touch nature and fundamental incapability makes it difficult for them to challenge the management.
Determining the value that the board delivers is one of the most vexed questions boards face and the reality is that most boards do not wish to face this issue.
Which governance model(s) across geographical borders do you perceive to provide the best basis for company growth and value-creation, and why?
No one particular governance model is better suited than any other. The governance models, in practice, reflect the political mindset and political nature of the country in which they sit.
Germany is one of the most successful economies and their two-tier board structure would, on this basis, be suitable for greater global application.
However, that is unlikely as the German political structure reflects the socialized capital nature of the German state. The German economy has one of the smallest stock exchanges in the world and the German government more relies on the debt market i.e. investors purchasing government bonds, rather than speculating in the equities market.
Thus, the more communal nature and concern for the citizens, which is at the centre of German politics, is reflected in the two-tier board structure with the supervisory board more taking into account broader stakeholder opinions than would their Anglo-American counterparts.
In contrast, the Anglo-American model reflects the short-term transactional nature of the Anglo-American states, where ensuring that investors are properly treated by management is the critical concern. No one model is best as the question more reflects geopolitical reality rather than governance.
Gazing into your crystal ball, which mega-trends within corporate governance do you expect to arise – in the UK as well as on a global scale – over the next few years?
The immediate likelihood of another financial downturn/collapse is highly likely. Company share price does not reflect company book market value. In the Anglo-American economies investors are looking for short-term, high interest returns, in saturated mature markets instead of investing in long-term infrastructure and communal projects.
This time, however, the likely imminent financial crash, is likely to be much worse than that of 2007/8 as governments no longer own resources/assets which they can dispose of in order to pay the debts that will arise
Further, financial institutions do not seem to have learnt from the 2007/8 crisis and are reliant on trading through transactional, debt based instruments which is the same as before.
Thus, war is the likely outcome and the world has been building up to this over the last few years and is likely to culminate in a showdown between the US and China.
The first indication of the likelihood of conflict will be the further and continued aggression of North Korea on South Korea in order to test what America is likely to do if South Korea were to be seriously threatened / invaded. The principle here is when debt becomes impossible to handle war is the way out.
Which – generic or specific – competencies/capabilities should every corporate board member have to qualify for his/her position, and which should the board as a whole be able to muster?
There are certain basic capabilities board directors should display, with financial acumen being the most important. Board directors need also to have a mindset of detailed scrutiny and an ability to stand back and analyse circumstances.
From there on in the capabilities required will depend on how the board delivers, or should deliver, value. The value imperative makes each board unique and different and in this sense, the capabilities required of its board directors change and adapt in accordance with the challenges faced by the company.
Probably the most challenging capability is that of having an independent mindset with each board director coming to their own view and conclusion concerning their personal contribution to the board
It is important to note that good boards do not necessarily display good teamwork, but rather open constructive and penetrating debate.
Thus independence of mindset and personal resilience to withstand pressure are vital to realising high quality dialogue on the board.
How does a board best interact with executive management?
There is no way best way to interact with executive management.
The original reports of the 1970s and 1980s, notably the Cadbury Report, UK, highlighted a sharp division of responsibility between the board and the management team and between the chairman and CEO.
However, my research indicates that due to the dynamic nature of markets and the ever present challenge of coming to a shared view on competitive advantage, it is required that first the chairman and CEO agree on their delineation of duties according to the strategy being pursued and the competitive advantage that the firm is trying to realise.
Once the chairman and CEO agree on who does what and why, the next point of discussion is the delineation of duties between the board and the management team, again shaped by an understanding of how to realise strategy and competitive advantage.
It is worth noting that relatively few companies adopt this more dynamic approach to delineation of roles and responsibilities and the majority of these companies are continually high performing.
What are boards lacking most today – for them to be able to deliver on their premise; to steward the company and add sustainable value?
Most board directors today do not offer sufficient time to be able to effectively steward the company.
Most board directors have a portfolio of directorships, which to date has inhibited giving sufficient time to knowing each company, its people and its culture and thus be able to effectively monitor and steward simultaneously.
Many board directors, in reality, treat their board as a committee, turning up to meetings, dealing with the papers in front of them and not sufficiently knowing enough about the company to challenge the management
It is all too easy to pull the wool over the eyes of most board directors due to their lack of insight about how the company really functions.
Thus, having three/four directorships in any one portfolio is the maximum number possible in order to be able to monitor and steward continually.
Two chairmanships and no other board directorships is equally the maximum that any one chairman can hold at any one moment in time in order to deliver effectively on their chairman role and responsibilities.
Thus, the need for board directors to be able to give more time to the board and the company, be more resilient in order to enter into sharp debate and be more independently minded in order to make that penetrating comment are the key and unfulfilled needs of boards today.