Society public company members across sizes and industries* responding to the most recent Society / Deloitte Board Practices Quarterly survey: “Back to basics: Board composition and refreshment” provided insights on their director recruitment priorities and refreshment practices.
Among the takeaways:
New director attributes—The top five backgrounds and/or professional experiences of directors appointed/nominated in the past 1 to 2 years were public relations and communications; culture and ethics; academia and education; first-time board directors (excluding nonprofit board service); and operations.
The top five likely backgrounds or experiences sought for directors to be recruited in the next 1 to 2 years are strategy; sustainability; international; a specific diversity attribute; and IT (e.g., infrastructure, operations).
New director positions/roles—Companies represented by respondents overall most commonly appointed or nominated active or retired CEOs/chairs/presidents to their boards within the past 1 to 2 years (42% and 35%, respectively). This compares to, for example, 29% that looked to other C-suite members and 27% that looked to financial officers to serve on their boards.
Composition change triggers—A desire for greater diversity and orderly/planned successions to keep the board fresh surpassed by a fairly wide margin other potential triggers for changes in board composition in the past 1 to 2 years (57% and 55%, respectively).
Issue-expert directors—Most boards have not nominated or considered nominating an issue-expert director (e.g., cyber, climate), either in response to investor or regulatory pressures or otherwise, in the past 1 to 2 years, and 46% say their board generally expects multiple directors (rather than an issue-expert director) to be at least literate/competent on an issue.
Refreshment policies—While most boards have age limit policies (86%), just 8% have term limit policies. The majority of boards with age limit policies establish 75 as the required retirement age. More than two-thirds of boards with refreshment policies (e.g., age or term limits or otherwise) are permitted to make exceptions to their policies.
Board matrices—A majority of boards or responsible board committees use a board matrix or similar tool to support their board recruitment/succession planning, and review and update their board matrix at least annually.
*Responses tended to vary by company size. Access the survey results online and by company size here.
Access additional resources on our Board Recruitment & Refreshment, Board Composition, and Board Practices/Governance Practices pages.