#summitSTRATEGY & execution

What is the least common method to appoint directors to the board?

A reader asked me this question.

First, I explore who chooses the board of Directors. Then common methods they use to chose. And finally, answer your question-the least common method used to appoint board members. I hope you did not ask this question to hide so that no one chooses you!

I will help you. Just do not be an outlier in your profession. Be a mediocre. Let no one read about you or quote you. Be a mediocre in your profession so that you are hidden from the public eye.

Appointment of directors depends on the type of the organization. Private company, public company or NGO. For private companies, listed on the stock exchange, with multiple shareholders, the majority shareholders chose the directors to present their interests.

The common method is folks they know are good, trustworthy, highly experienced and loyal. Such people play with them Golf, or fellow poets at exclusive clubs or are former consultants and advisors. When you have money it is easy to approach someone you admire and ask them to accept to represent your interests on any company board in which you have majority shared.

Then the private family businesses. The founder appoints the shareholders. That is the common method. The first place to look are his or children or close relatives. Next outliers and trusted business friends. Or former professor or family friend or competent child of a family friend or their friends. It is all about the sofa factor network—folks in my circles. The ones I trust.

Now for public companies like government owned entities the likes of NASA, NHS, BBC, etc. Don’t quote me, but the politicians In the office, the ruling class and or their major sponsors and affiliates pull the ropes. In developed democracies with strong systems and succession plans, this may not hold true. But in many, if not all, African countries where there is pseudo democracy or an appearance thereof, the ruling class politicians wield too much power over everything else.

They appoint everyone to any public office positions. From Cabinet (The Government Board of Directors) to Permanent Secretaries in Ministries and all positions in between as they build a loyalty based system. In this case, the politicians and their trusted advisors and financiers do the appointment.

And now to your question. In all the above, the least common method to appoint directors is placing adverts in the papers or popular media outlets asking for applications from suitable candidates. Reason, to sit on the board is not about identifying and nurturing talent. This is not a role of trial and error! A role of nurturing talent. No.

it is about picking winners or outliers in their respective professions for instant value addition to the business. There is no room for trial and error. To sit on the board, you must deserve your place on the board. You must be credible, competent and already a winner in your field to be respected by the executive as well as wider stakeholders since the board is the #1 credibility and reputation champion for any business. The bottleneck is at the top of the bottle, remember!

Today, governance codes and best practices recommend board diversity in terms of gender, professions, experience and global perspectives and culture mix due to increasing pace of globalization and technology adoption that is making global winners in form of platform and ecosystem businesses. So, no company owner would like to advertise for a board role to select someone who has never attained anything in their life, at least based on Internet search, popular global media and Universities. Surely, if someone is good, their name should be somewhere!

Want to get on the board, or hide so that no one appoints you? Check out my book on Amazon, 7 Tools of An Effective Board member: How to get on the Board …and be a fantastic Director.” Here is the URL, Home | Mustapha B. Mugisa (https://mustaphamugisa.com) To read more about boardroom dynamics. I have also started a forum on sins board members commit and how to fix them. Go to LinkedIn and check it out or in box. Happy 2020.

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