Wait and See Not an Option in Board Recruitment
While many directors agree that attracting and retaining younger, more diverse directors with a broader base of backgrounds is a priority, recruitment remains a challenge.
In a chat focused on board practices that correlate with good financial performances earlier today during the CUNA Mutual Group's Discovery Center, Filene Research Institute Ben Rogers shared that many boards seem to be adopting a wait-and-see attitude rather than emphasizing more rigorous recruiting practices like evergreen lists.
"Several interviewees stressed that it is hard to remove underperforming directors-even when their terms are up-for fear of hurt feelings. We see this, and the research backs it up, as one of the biggest challenges in credit union governance-the inability to move beyond the personal to performance," said Rogers.
He added that examples from boards of publicly traded companies revealed that they are very rigorous about looking for certain characteristics.
"It's simply understood that when the board needs expertise in legal, or marketing, or IT, then you go out and find someone who fits that," said Rogers.
Whether it's requiring each director to bring at least one candidate to the board's attention every year or adding associate directors to introduce a younger group of professionals to the boardroom, the general consensus was that recruitment essentially needs to start at the board level.