The Double-Edged Sword of Long Tenure

It’s an enormous compliment when a director’s term is renewed, especially when it’s renewed several times. But is too much of a good thing possible in a board setting? Can a director who has served more than a ____ years (you fill in the blank) still be an effective director? 

The easiest answer is “it depends.” What is happening in the industry? What new challenge is the company facing? Any recent acquisitions? What about board composition with regard to functional expertise? How do boards ensure the information they’re using in decision-making incorporates cutting-edge information or the latest research? What about age limits? What if you have a 70-year-old director who has the curiosity and energy level of a 40-year-old?   

For a price, consultants continually offer “expert” answers to the tenure question. The correct answer to the tenure question is that many years of experience is a double-edged sword.   

On the sharp edge, experience typically enables a board member to quickly assess a situation and ask questions that lead to rapid and effective action plans. Most important, board member experience can help management avoid costly mistakes and missteps.    

The other edge of the “experience sword” is that long tenure can create jaded or fading board members. “We tried that 10 years ago and it didn’t work.” “We know the CEO is not interested in addressing that market or closing that plant.” Extensive experience, similar to cataracts, can cloud directors’ vision. It can make board members less willing to try a new approach or even consider an alternative point of view. Worst case: too much experience can cause directors to miss or dismiss disruptive trends. Directors in 2007 on boards of retailers and newspapers come to mind. 

Now, let’s talk about you. Ultimately, it’s your responsibility to decide if “it’s time to go.” You will or should know. Objectively assess how you feel about the board. Putting aside COVID-19 constraints, ask yourself these questions:

1. Do you still get excited about attending board meetings?    

2. How thorough is your board meeting prep?  

3. Do you review the board book, prepare questions trying to see all sides of an issue, and stretch those ideas outside of the box? 

4. Are you still able to be challenging (of course, in a respectful fashion), or do you do a perfunctory read and know that your many years of experience will suffice at the meeting?

5. Do you enjoy debate and conversations with directors and executives inside and out of the boardroom, or are you inclined to only sit near favorite directors or execs at dinner?

Finally, the sixth and most important question: Are you intellectually challenged by the company, industry, and board? Being intellectually challenged is the primary reason I love serving on boards. Right now, each of the boards I’m on is incredibly challenging and lots of fun. Can you say the same? If not, perhaps it’s time for you to honestly assess your tenure.