Director's Domain August 15, 2022
Boardspan Inc.
Better boards create better outcomes | Board governance digital solutions | Trusted by leading boards in all sectors
Learning from the data. i) Refreshing Idea: A new report shows that boards aren’t relying on policies to dictate mandatory retirements, but instead employing assessments—of overall board and committee effectiveness and individual director contributions—to rethink and shape their composition. ii) Diversity Downshift: Another report suggests that when companies struggle to achieve expected profits, boardroom diversity observably stalls., iii) Powerful Pay: To impact ESG goals, studies show European boards are tying executive pay to outcomes, an idea U.S. firms are adopting more slowly…. The numbers also tell us that industries that experienced the most difficulty retaining employees are beginning to have an easier time hiring and retaining workers.??
BOARDS ADD VALUE: At Boardspan, we spend a lot of time talking to board members about the ways they add value and the many challenges they’re facing. Check out this?two-minute video ?that highlights what we’ve learned.
In the Spotlight
Boards Forego Mandatory Retirement Policies In Favor Of Robust Performance Assessments
“As companies are seeking to refresh the composition of their boards, they are moving away from policies that mandate turnover of their directors based on age or tenure. They are instead pursuing other avenues that provide for a tailored approach to opening up board seats for directors who will bring fresh perspectives, skills, experiences, and diversity to the board room… While mandatory turnover policies have been on the decline, [our] analysis reveals that substantially more companies are now conducting comprehensive board evaluations—a combination of board, committee, and individual director assessments... This has been accompanied by a marked rise in the share of companies using an independent facilitator to conduct board evaluations…These in-depth and independent evaluations can open fruitful discussions about many challenging topics, such as identifying areas where the current board’s composition does not meet the needs of the board and the company, and thereby facilitate appropriate board turnover.”?THE CONFERENCE BOARD
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Across the Board
When Company Growth Stalls, So Does Board Diversity
“Companies that are underperforming in comparison to their competitors or to their goals are more likely to experience a decrease in racial and gender diversity rates on their boards…Companies will always experience periods of growth and decline, making more consistent strides for diversity and inclusion among the workforce difficult. The problem is, diversity is not a priority for companies when profits decrease…Some countries in Europe have safeguards in place that would prevent progress on board diversity being rolled back. Gender diversity quotas are common in nations like France, Norway, Spain and Iceland, where women must make up at least 40% of boards at publicly traded companies.”?TIME
Industries Suffering Worker Shortages Begin To See Brighter Horizons
“Employers in hospitality, retail, healthcare and other industries hardest hit by worker shortages over the past two years say they are seeing emerging signs that recruiting workers—and getting them to accept jobs when offered—is becoming less of a challenge, even as the overall job market remains tight…Corporate leaders say the job market still favors workers over employers and that challenges remain in drawing enough staff. Still, many say the worst of the hurdles appear to be over…Fears of a recession or inflation also appear to be keeping some workers in their existing jobs, economists and executives say, leading to a drop in turnover in some industries—another boost for companies. The rates of quitting in both hospitality and retail have fallen in recent months from peaks earlier in the pandemic…though they remain elevated historically.”?THE WALL STREET JOURNAL
Musk Liquidates $7B Of Tesla Stock Ahead of Potential Twitter Acquisition
“Elon Musk, the chief executive of the electric vehicle maker Tesla, has sold about $7 billion worth of the company’s stock, a move he said on Twitter was an effort to raise cash in case he is forced to complete his $44 billion deal to acquire the social media company…. Mr. Musk signed the deal in April to acquire the social media company only to announce months later his intent to pull out, citing concerns about its accounting of fake users. His hesitancy coincided with a deep plunge in shares of technology companies, including Tesla, the primary source of his wealth.”?NEW YORK TIMES
领英推荐
Engaging With Shareholders More Important Than Ever
“Shareholder engagement should be top of mind for public companies now more than ever before – and getting it right requires careful work by in-house governance and other teams. The heightened need for engagement is due to a combination of factors including the lasting effects of the pandemic and resulting economic issues such as inflation and market volatility, the increased focus on ESG issues, growing numbers of shareholder proposals and renewed efforts by shareholder activists…”?CORPORATE SECRETARY
?How Your Board Handles Executive Pay Could Be Missing Piece of ESG
“How do you push corporate leaders to meaningfully connect their business decisions to the deadly flooding we saw in Kentucky this week or the heat waves that are disproportionately harming lower-income regions? One fast-emerging, if imperfect, solution is to link sustainability and social metrics to executive pay... Some 60% of respondents in Europe say their board ties ESG goals to executive pay, compared to only 37% of their North American counterparts.”?FORTUNE
From the Boardspan Library
Board Assessments: Learning What You Don’t Know
"Boards today are dynamic, evolving, and acutely aware of the rising performance expectations of investors and other stakeholders. Their responsibilities are constantly growing more diverse, complex and significant. In this high-stakes landscape, the most successful boards rely on thoughtful, comprehensive performance assessments to help them reflect on their activities and gain the actionable data and insights needed to continue delivering excellent performance. A meaningful performance assessment typically covers foundational topics to ensure that your board is aligned around its mission and fulfilling its responsibilities. It goes a step further to provide a roadmap for your board to embrace more effective governance practices and high-impact contributions.”?BOARDSPAN
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Seat at the Table
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About Boardspan
Learn more about?Boardspan ?and schedule a complimentary strategy call with our team.
Boardspan? is the leading provider of digital governance solutions for boards across all sectors. Our cloud-based assessments, dashboards, benchmarking analytics, and governance education programs complement our board search and advisory services to deliver a holistic approach to governance. Boards of all sizes and stages rely on Boardspan to deliver analytics, insights, and outcomes that improve their effectiveness and performance. Clients include KKR, The Kellogg Foundation, Ingersoll Rand, Farfetch, McAfee, Beyond Meat, Box, e.l.f. Beauty, Satellite Healthcare and the U.S. Olympic & Paralympic Committee.