NACD's BRC Report Series
Similar to an organization’s people, intellectual property, technology, and other assets, culture is a key success factor that contributes to an organization's competitive advantage and to long-term value creation. Yet in too many organizations, culture does not get the level of boardroom attention it deserves until a problem arises. The members of the 2017 NACD Blue Ribbon Commission issue a call to action for directors of all organizations to elevate their dialogue on culture—including culture inside the boardroom—in order to improve the quality of the board’s work and enhance its impact.
After Uber and Wells Fargo, Boards Wake Up to Company Culture Wall Street Journal
Culture manifests itself in many different ways and places around an organization. The boardroom is the natural place where all those threads come together.
The spread of transformative technologies will continue to cause rapid and often difficult-to-predict changes in competitive positioning within and between industries. A company’s ability to survive—let alone thrive—under these conditions will be determined in part by its culture.
Company leaders and boards need to be prepared to answer questions from investors about how they know the firm’s culture is more than just a written code of conduct.
The board’s role should be to demand from management a description of the cultural attributes that energize and enable the organization’s strategy and operating model—not just what we do, but how we do business and why—and ensure that the desired culture is reinforced...[in] policies, processes, systems, and behaviors in the boardroom and across the organization.
Build Culture Into Ongoing Discussions With Management About Strategy, Risk, and Performance
Emphasize that the way in which results are achieved is as important as whether or not a given goal is met.
Board-Level Reporting on Culture
Directors should demand both qualitative and quantitative data from management about the health of the firm’s culture, including information from sources outside the organization.
Formal and Informal Reviews of Boardroom Culture
Use results of board evaluations and executive-session discussions about culture to inform board composition, succession planning, and continuous-improvement efforts.
Make Culture a Formal Criterion in CEO Selection, Evaluation, and Compensation
Directors should set the expectation that the CEO and senior executives do the same with their own teams.
The report's commissioners are distinguished corporate directors and governance experts. In aggregate, they serve on the boards of 48 publicly traded and 28 privately held companies, and on 25 nonproﬁt organization boards. The commission included 11 current and former CEOs.
The titles and affiliations of commissioners in this list are selective and do not include all directorships. Commissioners participate as a service to the governance community and not as representatives of any organization.
Nicholas M. Donofrio
Director, AMD Inc., BNY Mellon Corp., Delphi Automotive PLC, Liberty Mutual Group, The MITRE Corp., NACD
Helene D. Gayle
McKinsey Social Initiative; Director, The Coca-Cola Co., The Colgate-Palmolive Co.
Director, Booz Allen Hamilton Inc., Sirius XM Holdings Inc., Zurich Insurance Group
MetricStream Inc.; Director, Nordstrom Inc., Verizon Communications Inc.
CECP: The CEO Force for Good; Director, FreshPet, Manna Pro Products LLC
KPMG Board Leadership Center
JPMorgan Chase & Co.; Director, Alaska Air Group Inc., Toyota North America Advisory Board
Director, Hess Corp., Tesoro Corp.
SAGE Leadership & Strategy; Director, Biscuitville Inc., Diversified Trust Company, Martin Marietta Materials Inc., NACD
Heidrick & Struggles
University of Delaware Weinberg Center for Corporate Governance; Director, Bob Evans Farms Inc., HealthSouth Corp.
Director, NACD, Southern Company Gas, Tenet Healthcare Corp., Smithsonian Institution National Board
NACD; Director, Nura Health Inc.
Global Corporate Governance & Executive Compensation Practice, Sidley Austin LLP
National Defense University College of Information and Cyberspace; Director, American Armed Forces Mutual Aid Association, Cubic Corp.
Director, Edwards Lifesciences Corp., Public Storage, Kaiser Permanente
Director, Fannie Mae, Morgan Stanley, Paxos, Workiva, Sustainability Accounting Standards Board Foundation
Director, Akamai Technologies Inc., PNC Financial Services Group Inc.
Director, NACD, Simon Property Group, National Bureau of Economic Research, US-Russia Foundation for Economic Development
Marie Oh Huber
eBay Inc.; Director, James Campbell Company LLC, Silicon Valley Community Foundation
Heidrick & Struggles; Director, Board of Governors of the Curry School of Education at the University of Virginia
Director, Ball Corp., Cummins Inc., CH2M, TransAlta Corp., Sims Metal Management
McKinsey and Co. (senior advisor); Director, Global Lyme Alliance, Johns Hopkins University Board of Trustees, Wells Fargo & Co.
Director, Axsome Therapeutics Inc., InsMed Inc., Liberty Mutual Group, Proteus Digital Health Inc., RiteAid Corp., University of Chicago Board of Trustees
Director, ACI Worldwide Inc., Quantum Corp.
Director, Consolidated Edison Inc., Pitney Bowes Inc., RELX PLC
Director, Lear Corp., Penske Corp.
Director, Clean Harbors Inc., Webster Financial Corp.
Director, Monsanto Co., US Steel Corp.
Novitex Enterprise Solutions Inc.; Director, Presidio Inc.
KPMG Board Leadership Center
Director, AEGON NV, Foot Locker Inc., Save the Children
Robyn Bew (ex officio)
The 2017 Blue Ribbon Commission Report features a range of practical materials directors can use to enhance their oversight of company culture. Available to NACD members, the report’s Toolkit has 15 sections with detailed guidance and tools to help directors benchmark current practices and implement the report’s recommendations, including these:
Our Blue Ribbon Commission Reports (BRCs) are NACD’s annual signature publications that propose new principles and practices to address the most critical boardroom issues. Read more about the history and impact of the BRC report series here.