In recent years, investors have focused on the importance of board directors. The board is comprised of members who bring their individual expertise, knowledge and networks to the table. But the main goal of any effective board is to work as a unit to evaluate the performance of the organization and help the CEO.
To achieve this goal the board must be structured to be efficient and equipped to fulfill its function. This is often accomplished by forming a strong team that can find the truth and serve as a critical sounding board.
Generally, it is recommended that boards have an equal number of new board members as well as experienced directors to give an array of knowledge and perspectives. The key to this is having an objective framework in place that permits nominating committees and the board in general to determine the skills and qualities that make the ideal candidate for a director position.
A popular tool is a board matrix which includes individual characteristics that help to guide the selection process of possible board candidates. But it is important to remember that just because someone has certain traits does not necessarily mean they are the perfect fit for the role.
A special kind of blockage to changes in the composition of boards is common in organizations that are dominated by one or more of the founders who believe they know best and are unwilling to take on the risk of change. This can result in a “founders syndrome” in which the nominating committees fail recognize the need for fresh talent and a new board composition.