Litmus test in chairperson selection

BD Board argument

Quite often once the chairperson has given an opinion, meeting attendants do not want to contradict or give an alternative view.

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Back in the 1980s, at the height of the Cold War era, a communist party meeting was taking place at a local village town hall. The chairman concluded his speech and asked if there were any questions. No one said anything until Dimitri raised his hand.

“I have three questions, Comrade Chairman. First, where have all our cattle gone? Second, where has all the meat from the cattle gone? Third, where has all the lumber gone?”

The chairman replied: “I have written your questions down and will have an answer prepared for you at next week’s meeting.”

Next week, the chairman concluded his speech and invited questions. No one said anything until Nikolai raised his hand.

“I have only one question, Comrade Chairman. Where has Comrade Dimitri gone?”

Part of our daily work at my consulting firm is helping family-owned businesses set up advisory boards as the first governance step in their sustainability journey. We guide our clients to undertake skills assessment needs for their boards so that they know what professional expertise is needed from the directors to be recruited. No two boards will ever look alike, just as no two companies do, hence, a cut-and-paste job across multiple boards is just not possible.

The most important role to fill, we tell our clients, is that of the chairperson. The chairperson sets the tone and the board culture that will eventually cascade into the organisation.

The discerning eye will look at the chairperson of your organisation and use that as the litmus test for the firm’s standing and reputation. A chairperson who is well respected by customers and employees alike is of high integrity, is personable, knowledgeable and firm, and will put the business in good public stead.

The chairperson whose name was last seen in the auctioneer’s pages in the dailies or dragged through a corruption scandal will taint your organisation with the same raised eyebrows they are already personally receiving. I tell clients that it is extremely easy to onboard directors. It is a nearly heart-attack-inducing process to ask a director, more a chairperson, to step down for malfeasances they may have undertaken elsewhere.

So what should a business founder look for when seeking a chairperson, other than the obvious reputational issues? There are five key attributes you should look for.

Firstly, has the candidate led another organisation, either as a chair or as a CEO? This would indicate whether they have the experience to provide overall guidance and drive performance. The second attribute is what is the candidate’s ethos and value system and does it align with yours as a business founder? If you are the kind of entrepreneur that likes to take shortcuts to financial heaven via the long road through tenderpreneurial hell, it doesn’t make sense to seek a chairperson whose ethical compass points only in one direction, scrupulously northward. You will only drag each other through many of the dreaded “we-need-to-talk” situations.

The third attribute the business founders should ask themselves is: would this person have the capacity to build consensus among divergent views on a board? This attribute is closely aligned with the fourth attribute, which is the chairperson’s capacity to listen first and speak last. Due to the deferential stance to seniority, which is our culture in this part of the world, quite often once the chairperson has given an opinion, meeting attendants do not want to contradict or give an alternative view. Hence the board protocol that the chairperson should speak last, summarising what they have heard from all participants, and then driving for consensus if there are disparate views. That is one of the hardest things to do, particularly if the chairperson is highly opinionated because they would want their view to be the final one. So in your assessment as a founder, look to see how the candidate engages with you in conversation, do they listen first or do they want to show you how they know a little thing about everything?

Finally, the fifth attribute is whether the candidate can guide a board to arrive at decisions that are in the best interest of the founder’s family, employees, customers, and suppliers if they were admitted into the ICU ward of a Mumbai hospital. Would the founder’s back, laying flat on that hard hospital bed, be covered and protected from potential leadership coups or missteps from those appointed to look after the ship in the founder’s absence? Will Comrade Director Dimitri be made to disappear for asking the hard questions?

This is not an exhaustive list of attributes, but it is a basic litmus test to apply as you seek the individual who will help you safely let go of the founder’s leadership chains.

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