Transparency and Competence

NBPSPP, Board Bios and Transparency

To follow up on yesterday's post, if you have not read the NBPSPP 2016 Annual report and you are a pensioner with this plan, you should...especially the Trustee biographies. If nothing else, it will assuage any fears you might have that the board is under qualified.

To be sure, there is a lot more training that they might profitably receive to enhance their governance skills. Certification or Accreditation would be high on that list. It is, in fact somewhat surprising that this has not been broached given that one of the trustees was on the board of the CICA.

Go to the CICA website.

There are some truly excellent materials focused on governance including downloadable handbooks. 

Some trustees have had non-profit board experience and one continues that journey.

So, what skills are they likely to have developed as a consequence of some of this corporate and non profit experience? 

The National Study of Board Governance Practice in the Non-Profit and Volunteer Sector in Canada, a new non profit director can expect to learn:

• how to evaluate the board based on agreed governance practices
• measure the effectiveness of board meetings
• determine stakeholder satisfaction
• set board goals and measure success in reaching these
• build milestones into that process
• distinguish between evaluating the board and measuring the effectiveness of the organization
• learn how to measure both over time
• determine the relative success of the strategic plan's implementation
• use qualitative as well as quantitative measures
• set expectations for board members and monitor performance accordingly
• set expectations for board members and evaluate it based on accomplishments
• hold annual peer, board and individual member assessments. 

The annual report references some board education supplied to the board members. None of these opportunities dealt with governance. Nor was there reference made to the kinds of newspaper materials circulated to the board. Nor was there any reference made to the use of external governance authorities in board continuing education. 

So, once the website is up and posted (2018) presumably the kind of education board members will receive in the next fiscal year will be shared with those of us who are pensioners. 

More on this tomorrow. Did you know that despite union affiliations, directors on NBPSPP are still designated as independent? How does that work, I wonder?

A Changing Workforce

If you don't follow Janet McFarlane, in the Toronto Globe and Mail, you should. Ms McFarland writes often about women in the workplace and more particularly, about the challenges that women face in securing leadership positions in the corporate world. 

She has noted 2 trends of which women should be aware. The first trend is a re-consideration of what constitutes independence. Given that directors should be independent in fact and mind, questions are raised about directors who enjoy a lengthy tenure on a board. 

By virtue of their lengthy tenure, what are the chances that they have retained their independence? McFarland, in an interview with York University's Richard LeBlanc, noted that some countries are setting term limits. You would/might be surprised how many corporations do not.

Spain's and France's Governance Codes recommend a term limit of 12 years. South Africa and Norway recommend 9 years. Australia notes that a director is no longer independent if she remains on the board for longer than 9 years.  Term limits and a better definition of what it means to be independent will certainly open up board vacancies a boards strive to have a majority of positions termed independent. If Australia has taken this position, will Canada be far behind? Only time will tell!

Directors are also aging. 20 years ago, 47% of directors on the FP 500 were over the age of 60; 15% were over the age of 70. Since 2010, 20% of directors are being replaced because they are aging out (so to speak). 

Consider also that an untapped resource for boards may be in female owned businesses. In the US women account for about 30% of such businesses with $951b in sales.

Another source of qualified female board members , at least in Canada, is in the non-profit sector. Women occupy 88% of the leadership positions in this sector. 

It would seem that corporations are positioned to:

• re-define the pool of eligible directors
• reconsider the eligibility criteria so that women who have other than senior management experience are given an opportunity to serve as directors
• consider qualified women from inside the corporation for board sub-committees involvement as a proving ground for their abilities.

Take advantage of the opportunity!

So, how does all this relate to harassment in the workplace? Take a look at the interview this evening on CNN between Smerconish and Tina Brown (x of Vanity Fair and the Daily Beast) .