15th International Conference on Governance and Sustainability.

In an era of insecurity and uncertainty building tomorrow's boards is a challenge. We cannot be sure what the future will bring. Innovations, technological breakthroughs, market and regulatory developments may occur. There may be new competitors, challenges and opportunities to confront. These developments may fundamentally change our aspirations, priorities and the nature of our organisations.

The personal qualities of directors, their openness and willingness to learn, their integrity and flexibility, and their ability to assess a situation as a whole, read the road ahead and instinctively take decisions that are in the best long-term interests of the business become critically important. Diversity in terms of people's backgrounds, nationality, perspectives, operating styles - and especially in ways of thinking - can also be helpful.

One can periodically review the composition of a board. However, challenges can suddenly arise and windows of opportunity can quickly open and close. Finding appropriate new directors, completing an induction process and becoming effective all take time. Sometimes we have to run with the people we have and take steps to ensure they remain independent, current and vital.

Corporate governance has a high profile. It is written about in journals and discussed in seminars. It attracts those who like to discuss principles, develop approaches and debate different models. Universities and business schools recruit academic experts in corporate governance. Consulting firms have their governance practices and teams.

Director and board development has a much lower profile. It is less talked about. It may be undertaken by individuals whose assignments are covered by confidentiality agreements. It does not usually involve protracted debates about principles. It is more likely to be practical and about addressing issues that are inhibiting progress.

Standard governance models first developed over twenty years ago in response to problems with listed companies in certain jurisdictions may not be relevant to the pressing and future needs of entrepreneurs, SMEs and family companies and other organisations elsewhere. Corporate governance codes may not be appropriate to an enterprise's stage of development or relate to the challenges and opportunities it faces.

In comparison with general approaches, director and board development can be quite specific. It can address issues as and when they arrive. It can meet the requirements of individual directors and the needs of the board as a team. It can confront the requirements of new models of organisation and ways of working, operating and governing that were not considered when governance codes were first developed.

When done properly director and board development can impact directly on corporate performance. It can tackle obstacles that originate in the boardroom and prevent progress. It can directly tackle barriers to greater contributions from individual directors. It can confront specific issues and problems as and when they arrive.

Certain forms of director and board development are flexible and can be continuous and on demand. They can allow individual directors and boards to grow and develop as an enterprise expands, builds its capabilities, extends it reach and becomes more complex. Boards can regularly review what they have learned at key steps in a process, or after confronting a novel situation or taking a difficult decision.

Director and board development can directly address the individual and collective needs of a particular group of directors. It can match the evolving requirements of a developing business and the growing confidence and ambitions of those involved. It has great potential, but its effective realisation cannot be taken for granted.

For some directors development is for others. They are reluctant to acknowledge their own development needs. Surely they must be OK or they would not have been appointed to the board. Besides, what could they learn from a trainer or coach who does not hold a board appointment?

Sometimes it takes an obvious failure or new challenge to trigger acknowledgement of a development need. Perhaps the directors have got something wrong or are struggling to cope. What was once exhilarating and exciting may have become more burdensome and stressful.

The qualities, experiences and competences of many directors reflect where they have been rather than where they would like to go, or should go. Too often director and board development is about catching up and addressing past deficiencies rather than preparing for the future.

Some boards make an initial move after a period of success when a step change has to occur. It might be overseas expansion or the introduction of new products and technologies. Perhaps greater delegation is required to a new generation of people. Owner or founder directors may wish to groom successors.

Whereas governance debates are often about structures, the assessment of development requirements is more about behaviours and improving what directors do, how they interact and the quality of board decisions. It can embrace individual learning programmes and/or team activities.

Diagnostics can be used to explore the roles that individual directors play and their contributions, perspectives and approaches. They can also help with the identification of factors inhibiting better performance and areas where change is required.

Priorities can depend upon roles, ambitions, what is delegated and pressing challenges and opportunities. Some boards are strategic. Others stray into operational areas and muddle the distinction between ownership, direction and management.

Responsible boards commit to regular reviews and continuous learning. Confident directors willingly assess themselves against directorial competences. They allow others to appraise them and comment based upon observations of how they perform. However, some assessments pay too much attention to improving what already exists rather than equipping people for future developments.

Development programmes can prepare people for their first and further appointments, as an executive or non-executive director. They can help individuals to better cope with the pressures directors face and the dynamics of the boardroom. They can enable individuals to add more value on a particular board. They can improve particular board processes and activities ranging from visioning to intelligent steering.

Director and board development can focus explicitly on behaviours in and out of the boardroom. It can reflect and directly address any deficiencies of conduct in the boardroom, whether of individual contribution, inter-personal dynamics, how business is handled or how decisions are taken. Issues, areas and activities unaffected by governance arrangements can be confronted and improved.

At the end of the day what do we want? Do we worry whether boards have a particular governance structure? Are we more concerned that directors are competent and boards are effective? Should the priority be upon ensuring they take the development steps needed to remain competent and effective as businesses grow, situations and circumstances change and new challenges and opportunities arise?

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Notes:

Speech 'Building Tomorrow's Boards: Director and Board Development' delivered by Prof. Colin Coulson-Thomas on Thursday 8th October 2015 to the 15th London Global Convention on Corporate Governance and Sustainability in the Ballroom at the Millennium Hotel, Grosvenor Square, London W1K 2HP

*Prof. Colin Coulson-Thomas holds a portfolio of board, public and academic appointments in the UK and abroad. He has helped companies and public and professional bodies in over 40 countries to harness more of the potential of directors, boards, management teams and corporate capabilities to improve performance and deliver multiple objectives. He is a member of the business school team at the University of Greenwich, Director-General, IOD India, UK and Europe Operations and leads the International Governance Initiative of the Order of St Lazarus. Colin is also a member of the General Osteopathic Council and chair of the council's Education and Registration Standards Committee and chair of the Audit and Risk Committee of United Learning, which is the UK's largest operator of academies and independent schools. Author of some 70 books and reports he has held professorial appointments in Europe, North and South America, the Middle East, India and China, and has spoken at over 300 national and international conferences. He was educated at the London School of Economics, the London Business School, UNISA and the Universities of Aston, Chicago and Southern California. A fellow of seven chartered bodies he secured first place prizes in the final examinations of three professions. He can be contacted at colin@coulson-thomas.com. His latest books and reports are available from www.policypublications.com.