At the start of 2020, director duties and responsibilities are more onerous than ever. Following reports from the various Australian Royal Commissions over the last two years there is much for directors, and potential directors, to think about.

In our work with boards and executive teams around the world, we are sometimes asked “So what makes a good board director?”  

Here are a few observations from our experiences which we hope may be helpful when considering board composition and the development of a skills matrix.

Good administration and efficient information pathways are critical to assisting a good director do their job well.  Understanding their role, being committed to it, being well prepared for meetings, and reading and thinking about issues beforehand contributes to robust debate in the boardroom. A well-crafted Board Charter can assist directors in better understanding their roles and responsibilities. Good induction processes enable a new director to be more effective more quickly.  Governance qualifications, continual updating of knowledge (reading, attending seminars, briefings and conferences) and ongoing training are imperative for directors to stay on top of changes in the governance environment.

Good directors demonstrate the following qualities:

  • Objectivity and independence, yet passion for the mission of the organisation.
  • Emotional intelligence, self-awareness and the ability to assess their own skills and knowledge in areas that are rising priorities.
  • Active listening and the ability to ask challenging, difficult questions in a constructive way.
  • The capacity to remain highly strategic, yet know when there is a need to dive into the detail.
  • Understanding the business in depth.  
  • Being an independent thinker with the courage to speak their mind.
  • The capacity to act as part of a team with a clear sense of shared purpose.
  • Understanding finances, risk, technology, having a global outlook, and a long-term strategic view.
  • Commitment to ongoing learning and development.

Good directors are able to test assumptions and the information presented to them by the executive team in a respectful and constructive way.  Directors of high performing boards are aware of how their own behaviour impacts their board and wider organisation.  They respect the views of others, even though they may not agree.  They exhibit rational compassion towards each other and encourage diversity of approach to problem solving.  A healthy board culture is constructive and challenging in a respectful manner.

Sometimes deep industry knowledge may blind a director to “outside the box” possibilities, and broader “business of business” knowledge may be required.  This can apply to areas that need generalist skills such as technology, marketing, human resources, team building, politics, media and others.  It depends on what the organisation needs at the time in an overall skills mix.

When it comes to making decisions, directors must be guided by the mission, vision and values of the organisation in order to achieve the best outcome for all concerned.