Strategies to get that directorship

What Strategies should Women Pursue?

This particular post is about strategy. How should the Board Game, Women on Boards structure the strategy component of the game? 
There are 6 areas to consider including:

1. Qualifying
2. Personal advancement
3. Choosing the right company in the right sector
4. Build a skills matrix
5. Research the sector and employer
6. Who can help?

1) What qualifications to corporations seek?

There are a few according to Spencer Stuart and Ernst and Young.

Ranked, these include:

• Executive leadership. Have you functioned in a senior management position?
• Industry expertise. Are you known in a particular sector?
• financial accounting (surprisingly to me, at least) ranks high
• Experience on other boards. Tis might seem like a disingenuous qualification. I mean, you are looking for experience but you need experience to get experience. This is where your volunteer board work comes in handy at the local, regional and national levels. The latter, in particular, can give you substantive notoriety.
• Operational experience. So, perhaps handling significant projects in a particular sector.
• A global perspective. 
• Strategic planning
• Marketing 
• An expertise in Corporate governance (academia, journalism, professional association )
• Public policy/governmental affairs. So, have you worked as a senior civil servant such as a Deputy Minister or ADM?
• Risk assessment
• under 60 years of age. ( sorry. Although NO credible search team will say it, the reality is that almost no one > 60 and without board experience gets even a look)

2) Strategies

• Excel, be recognized, meet the right people. These might all fit under the broader strategy of building your brand. So, the first step is to get a really good education, preferably at a niche university and in a profession. Build notoriety early by volunteering at a local level, writing for the university newspaper and working on the university radio. Be credible and try out ideas. Start early on a local board to find out what it is like and begin to meet people at that level. 
• During this period, develop a game plan. This strategy carries forward with membership in a professional association and continuing education as a director. Even a start with the United Way program, then advance through to the ICSA Acc Dir. program and then an MBA focused on a specialty in good governance. MBA schools focus on certain elements such as CSR (e.g. Laval), ethical governance (e.g. McMaster).  Be canny. Choose a school based on what the current issues in governance currently are. 

3) Choose wisely

Sometimes all of us rush into a job because it is, well, a job. Then we stop and look around to see where we are...and sometimes it ain't pretty

• Does your employer have a commitment to building leaders amongst women. So, have they signed to Catalyst Accord? This is a voluntary pledge by Canadian companies to increase the overall proportion of women on FP 500 boards to 25%. 
• Are there formal board policies making diversity a criterion of board composition?
• Does the board have term limits. A regular refreshment will create opportunities to recruit women.
• Is there evidence that the corporation (and the board) seek out qualified women?
• Are you in a sector where boards require market expertise, industry knowledge or functional capabilities?
• Is there evidence that the sector boards consider directors with non profit academic or public sector expertise? 
• Is there evidence that , for this sector, traditional networks work? If so, make sure that you are a part of the "right" alumnus. 
• Is there evidence that the sector recruits "board ready" women?
• What proportion of women are in leadership positions in the company or sector?

4) Based on your answers to these questions,  you need to build a skills matrix. 

5) Dig around

Do the nominating committees recruit |(or appear to recruit) from a broad talent pool?

Check out the way committees do their work. Do they, for example, look at CV's without looking at names? This will give you an idea of whether committees might unconsciously filter out women when considering candidates. 

6) There are some great Canadian organizations which might help women looking to advance their careers as directors.

• Association of Quebec Women in Finance https://affq.org
• Catalyst www.catalyst.org
• Canadian Diversity Board www.boarddiversity.ca
• Canadian Women in Communications www.wct-fct.com
• Reseau des femmes d'affaires du Quebec www.rfaq.ca
• Women in Capital Markets https://wcm.ca
• Women in Leadership Foundation www.womeninleadership.ca
• Women's Executive Network www.wxnetwork.com
• Association of Women in Finance www.womeninfinance.ca

We are almost ready to start building the game. 

NBPSPP, its Board and Risk Management

As noted in previous posts, the Board should ensure effective and ongoing risk management...and report these efforts to the retirees as well as through the annual audit report to the annual meeting. beyond this, the risks should be ranked with assurances to the retirees that the focus of management and the board is on addressing these. 

But how? 

The risk assessment process should involve a review o the risks affecting or likely to affect the integrity of the Plan., its various revenue streams , the critical dependencies of the Plan, the sustainability of its legitimate interests and the expectations of the retirees, who are its principle stakeholders. 

It is, in short, a top down function and is an element of the work of each of its committees. And, from these committees (the ones which have been outlined in earlier posts and which the plan does not yet have), the board should receive regular reports based on a register of risks developed by the board. These risks ought to be quantified. 

There are a few risks inherent within  the governance structure of  the NBPSPP.

1. There should be the separation of the Audit Committee from the Board (SOX).
2. There should be (and there appears that it is) a separation of the Auditor from the management of the Plan.
3.  We, as retirees, should know the restrictions of the work of the auditor. Do they , for instance, consult to the Plan or to management. 
4. The Chair of the Audit Committee should have solid financial credentials. This would need to be determined. But, the fact that the Chair of the Audit Committee is also the Board Chair seems to me to be a clear conflict of interest (ya think???).
5. Is there a CEO/CFO certification of the financial statements?
6. Does the Board have a role in assisting management with strategy and, within Vestcorp, talent development? Is that appropriate?
7. Is there a Nominating Committee...and if not why not. There does not appear to be. Typically, this committee would look after the induction and succession planning. Is there compliance with emerging governance legislation in Canada and in NB? 
8. Nor is there a compensation committee. This ought to be made up of independent directors. We do know that there are 2 ID's and that the current board believes that they are entitled to name who is and who is not independent. Is compensation to Vestcorp aligned with performance? If so, what are the guidelines? More will be written about say on pay and proxy voting. 

So, what's the role of the Audit Committee?

A few items which appear absent from the Auditor's report to the retirees at the annual meeting include:

1. The effectiveness of the Plan's public reporting processes;
2. the effectiveness of the Plan's management's internal controls;
3. the extent and frequency of risk management reports and the degree of monitoring of risk;
4. the extent and frequency of identification of failings and those actions to correct them;
5. the scope and quality of management's risk monitoring, the system of internal control and the work of the internal audit function
6. how often the Board and its committees use independent advice.
7. Is there an internal auditor? 
8. Are the accounting policies appropriate to the task?
9. Were there any significant or unusual transactions?
10. Were disclosures to and by the Board clear and complete?
11. Are there any areas of dissatisfaction?

Consider these regulations from an Audit Committee perspective.

Sarbanes Oxley (I know, its US but..) and NI 52-109 provides guidance on how investors (us) are to be protected from fraudulent accounting activities.

NI 52-108 provides direction regarding the oversight of the Auditor

NI 52-110 describes the role of the Audit Committee in monitoring and ensuring the independence of the external Auditors.

CBCA s 155 describes the duty of the Board to report Financial statements.

What do CAPSA, CCGG and CICA have to say about Plan Risk Management? More on this tomorrow