NACD and Korn Ferry Release Nominating and Governance Committee Blueprint with Key Guidance on Five Core Themes as Part of the Future of the American Board Initiative
Korn Ferry led seasoned board directors in a working group to develop five areas of focus for nominating and governance committees, now and in the near future.
Nominating and governance committees will play an Increasingly Important role as boards work to reinforce expectations of director behavior and board culture.
The blueprint provides guidance for board refreshment and succession planning:
Fostering continuous improvement in board performance and delegating oversight of cross-board matters are crucial to successful committees.
The working group outlined ways that the nominating and governance committee, working closely with the CEO, can help engage shareholders and stakeholders.
WASHINGTON, DC (May 16, 2023) – The National Association of Corporate Directors (NACD), the authority on boardroom practices representing more than 23,000 directors, in partnership with Korn Ferry, today published their Nominating and Governance Committee Blueprint as part of the NACD Future of the American Board initiative.
Keeping in mind evolving board workloads and agendas, the Future of the American Board Commission's Nominating and Governance Committee Working Group looked specifically at five areas of greatest importance to nominating and governance committees:
Setting board culture and expectations for directors. The committee should help define an inclusive board culture, set (written) expectations for directors, design a rigorous renomination process, and ensure that board leadership reinforces the agreed culture and expectations.
Aligning board composition with corporate strategy. The committee must ensure that board composition is aligned with long-term corporate strategy. To do this, the committee can create a long-term succession plan, enable regular refreshment of the board, and plan for board leadership succession.
Fostering continuous improvement in board performance. By ensuring that all board members have a thorough onboarding, enabling high-quality continuing education opportunities, and requiring rigorous board and committee self-evaluation, the committee can prepare the board to help the company deliver on its strategic objectives.
Improving oversight of cross-board matters. Specifically, the nominating and governance committee may be responsible for CEO succession, oversight of sustainability matters including climate, and decisions about whether to form new committees.
Overseeing board involvement with shareholders and other key stakeholders. With a shift toward a more inclusive business environment, nominating and governance committees should work with their CEOs to oversee an engagement strategy for shareholders and stakeholders.
The Nominating and Governance Committee Working Group, a panel of leading nominating and governance committee chairs from NACD-affiliated organizations as well as senior leaders from Korn Ferry's Board and CEO Services Practice, created the Blueprint with the goal of helping nominating and governance committees to leverage their qualities in those five key areas to become strategic assets for their companies.
"The five themes that we focused on present the greatest opportunities for nominating and governance committees to help rise to the occasion of new and changing demands," said Phyllis Yale, a Nominating and Governance Working Group participant and board member at Aledade and Bristol-Myers Squibb, chair of the nominating and governance committee at DaVita, and vice chair of the nominating and governance committee at Blue Cross Blue Shield of Massachusetts. "From board culture and composition to improved performance and communication, the Blueprint touches on issues that are at the forefront of our committees today."
"One of the most compelling aspects of this Blueprint is the guidance to focus on board culture and director behavior, shifting our implicit expectations to explicit ones, with a primer on how to do so," said Peter Gleason, president and CEO of NACD. "This is something we will dig deeper into in our upcoming 2023 NACD Blue Ribbon Commission report on dynamics and culture within the boardroom."
"As new and emerging issues arise that require board oversight—like sustainability—nominating and governance committees can either take on those responsibilities or coordinate them across other committees," said Anthony Goodman, head of Korn Ferry's Board Effectiveness Practice and convenor of the Nominating and Governance Committee Working Group.
Added Tierney Remick, vice chair and coleader of Korn Ferry's Board and CEO Services, also a member of the Working Group, "It is our hope that our Blueprint provides nominating and governance committees with actionable guidance to help them navigate the great changes and challenges facing boards as a whole and their committees specifically."
The Nominating and Governance Committee Working Group is the third of four Future of the American Board panels to publish Blueprint guides this year. In addition to the Nominating and Governance Committee Working Group, the Compensation Committee and Audit Committee Working Groups have published their work; the Risk Committee Working Group is set to release its Blueprint next month.
A digital version of The Future of the American Board: Nominating and Governance Committee Blueprint is available at nacdonline.org.
The National Association of Corporate Directors (NACD) is the premier membership organization for board directors who want to expand their knowledge, grow their network, and maximize their potential. As the unmatched authority in corporate governance, NACD sets the standards of excellence through its research and community-driven director education, programming, and publications. Directors trust NACD to arm them with the relevant insights to make high-quality decisions on the most pressing and strategic issues facing their businesses today.
NACD also prepares leaders to meet tomorrow's biggest challenges. The NACD Directorship Certification® is the leading director credential in the United States. It sets a new standard for director education, positions directors to meet boardroom challenges, and includes an ongoing education requirement that prepares directors for what is next.
With an ever-expanding community of more than 23,000 members and a nationwide chapter network, our impact is both local and global. NACD members are driven by a common purpose: to be trusted catalysts of economic opportunity and positive change—in business and in the communities we serve. To learn more about NACD, visit NACDonline.org.
About Korn Ferry
Korn Ferry is a global organizational consulting firm. We work with our clients to design optimal organization structures, roles, and responsibilities. We help them hire the right people and advise them on how to reward and motivate their workforce while developing professionals as they navigate and advance their careers.
Korn Ferry's board and CEO advisors have deep expertise in the matters that concern CEOs and boards the most as they navigate these dynamic changes from board consulting, board succession planning to board effectiveness. In addition, our team are specialists in CEO succession planning and can guide boardrooms on how to identify, develop, and support the CEOs for today and the future.
Visit kornferry.com for more information.
About the Future of the American Board
NACD convened the Future of the American Board Commission—a diverse, influential group of seasoned board leaders from top private and public companies and notable governance practitioners from across the investor, regulatory, and academic communities—to help guide boards through an increasingly turbulent and unpredictable future. The Commission's perspectives and experiences shaped a comprehensive framework for board governance centered on 10 Key Principles that boards can use and adapt to ensure they are fit for the future. This framework, released in the fall of 2022, is accompanied by a set of practical blueprints, focused on the shifting roles of the key board committees, issued in the spring of 2023. Recognizing that committees are the engine of the American board and that good governance begins at the committee level, NACD tapped world-renowned firms to help lead the Future of the American Board Committee Working Groups. Partners leading these working groups are KPMG (Audit Committee), Marsh McLennan (Risk Committee), Pearl Meyer (Compensation Committee) and Korn Ferry (Nominating and Governance Committee). For more information, visit view.nacdonline.org/futureboard.