Canadian HR Reporter

MARCH 24, 2014 CANADIAN HR REPORTER & STRATEGIC CAPABILITY NETWORK Credit: Andrey Popov/Shutterstock BY LIZ BERNIER DEALING WITH the board of directors is a critically important task for senior executives — yet there's usually no formal training or preparation on how to do so eff ectively. " e higher any executive rises within an organization, the more time he or she is going to spend interfacing with the board — whether that's the CHRO, the CEO, the chief fi nancial offi cer. Yet, amazingly, most people re- ceive absolutely no training or guidance," said Beverly Behan, New York-based president of Board Advisor, at a recent Strate- gic Capability Network event in Toronto. "When you take an MBA or a law degree, nobody teaches you how to work with a board of direc- tors. Most people learn that from watching their boss, and they pick up good and bad habits along the way." Behan discussed some classic boardroom mistakes, as well as HR priorities such as CEO succes- sion planning, in a panel discus- sion with senior HR professionals — and veteran board members themselves. Creating engagement in the boardroom Before anything gets accom- plished, the senior management team must know how to commu- nicate eff ectively with the board. And most of that communication takes place during presentations, she said. One of the most common pit- falls is failing to engage with the board as an audience, according to Pierre Lavallée, senior vice- president and chief talent offi cer at the Canadian Pension Plan In- vestment Board in Toronto. "Presenters who look at the screen and point to the screen (without) looking at their audi- ence to see what is it they're in- terested in usually fl ame out — because they have no idea what's going on around them," he said. " e worst mistakes, I'd say, are reading slides instead of telling a story, and just generally too much material." Also, people should avoid "wildly over-answering" ques- tions that only require a simple response, said Lavallée. " e most important thing to keep in mind is every organiza- tion has to do what I call 'Keep it natural.' Because people can smell a situation that's unnatural," said Geoff Beattie, former CEO of the Woodbridge Company and current board member of Gen- eral Electric, RBC and Maple Leaf Foods, based in Toronto. " e thing that I think really effective CEOs do is they take on the responsibility of ensuring that there's engagement… We've all been in those rooms where we look around and people are on their BlackBerrys, they lack that sense of engagement. Invariably, at the end of the session, (every- one) is dissatisfi ed." To avoid some of these rookie mistakes, HR might consider of- fering training for executives on how to work with boards — an initiative Sun Life already has in place, according to Carrie Blair, executive vice-president of hu- man resources at Sun Life Finan- cial in Toronto. "When we have new folks, who actually are presenting for the fi rst set of times, we actually do bring in external communications consultants to really get them grounded in… how do you pres- ent, what's the right content, how do you make sure you're landing the key messages and telling the story," she said. "For some of our most seasoned executives… we've actually done some real work with them around how do you answer those direct, sometimes more aggressive ques- tions you can get from a director?" CEO succession planning Effective communication with boards is important for innumera- ble reasons, but perhaps the most important is the board plays a key role in choosing the organization's next CEO. "So much is said about com- pensation but probably the board's single most important decision is who's going to be the chief execu- tive offi cer," said Behan. " is is a real fruitful area for boards to pick up their game — and where you may be able to help them." at single decision is one of the most important things a board is tasked with, according to David O'Brien, former president and CEO of Toronto Hydro and cur- rent board member of OMERS, based in Toronto. " at (new CEO) will be the outward face of the board, that's the individual that will be most recognized out in the market- place… but, equally important — and people forget this often — is it's also the person that is inwardly facing." OMERS just went through a CEO transition that took two years to put into place. ey eased the new CEO into the role over a period of months, said O'Brien — first, by attending meetings alongside the current CEO and, eventually, by standing in for him. "So when we made the an- nouncement, there was not a pushback in the marketplace," said O'Brien. "Everyone should have a suc- cession plan for the CEO. Don't wait for the CEO to get hit by a bus. e worst thing you can do is to have no leadership in an organization." One pitfall in the succession planning process is when the cur- rent CEO is reluctant to leave and becomes less than co-operative, said Beattie. Another is when the process is based on a rewards sys- tem instead of merit. " e role of CEO succession, far too many times, is a reward system for a job well done, as op- posed to a rigorous, disciplined process of saying, 'What do we need going forward?'" he said. Often, companies hand over the CEO position as a reward for doing a good job instead of really critically looking at whether that person has what it takes for the role, he said. To help avoid that pitfall, HR should identify and consider ex- ternal candidates as well as inter- nal ones, said Blair. "It's your job not only to create internal succession but to know who the best people are in the marketplace and to be identify- ing those people — and, where you can, forging relationships with them… so that when the day comes that the board makes the decision, they at least have options." Board relations 101 Eff ectively dealing with directors is critical — but it's not something you learn in school

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