One thing not deeply enough thought about when recruiting new board members is how will that individual behave in a highly stressful environment? Because “shit happens”, and you’ve got to be prepared.
Sitting on a board is serious work — in the amount of preparation required and contribution to the dialogue at board and company levels. The serious issues companies have to deal with require both a level of experience and an emotional engagement in what’s going on — to ask the right questions and demand the right answers. If something cataclysmic happens, how will the board behave? Can it pull together to discharge its responsibility to shareholders and other constituencies?
We deal with a multi-stakeholder environment, and knowing how to deal in that complex environment, or monitoring how the leadership of the company deals with that is another aspect of board composition. It’s important to keep that in mind as you evaluate prospective board members. How do you assess that capability? You just have to probe; to look [a candidate] in the eye while he or she tells you how they reacted to a difficult situation with another board or company. You take a significant portion of that at face value, but you also do your homework, check your networks and ask: “Did he/she really behave that way?”
I’ve been involved with the Bloomberg board since 1996, and I think we’ve created a really good work environment for people of different backgrounds. I attribute this to Mike (Bloomberg, founder) and our ability to carry it on. You’ve got to create an attractive work environment where people feel they can bring their whole selves to work. Values the company espouses — and employees embrace — have insulated us a little from some of the things going on in the world, like around #MeToo. That catharsis is constructive — and long overdue. Like cybersecurity, this whole issue around employee relations must take on a much higher level of visibility at board level than in the past.
Mix it up
The data is irrefutable that the more diverse inputs into a decision-making process for a group, the better the outcomes. It’s a business imperative. Whether at board or company level, having that kind of diversity results in better performance and greater success for the institution. That’s a compelling rationale, which needs conscious intervention.
Leadership from the top is critically important. You need enlightened leadership that understands the incremental value that can accrue to the organisation and its shareholders by having a more diverse group of professionals helping to make decisions. [At Bloomberg]
23 business units submit a diversity and inclusion plan to me once a year as a mainstay of their human capital initiative. I meet them every six months. We’ve created the Chairman’s Challenge — focused on recruiting, retention, development — because I want people on different business units to try different things. If they work, we can socialise them more broadly across the firm.
During my career, probably half a dozen people took a risk on me. Leadership is about inspiring people to do things that they wouldn’t ordinarily ask of themselves. I have 12 mentees a year — six men, six women, people of colour, people of different sexual orientation, people with broad geographic representation. Part of what we’re trying to do is to force earlier risk-taking in our female colleagues. We focus on individuals at an inflection point in their career — looking for their next challenge, stepping into a new role, regional responsibility or managing a large team for the first time. It’s a one-year program.
We’ll hire between 2500 and 3000 people this year. If you add our summer interns, it’s another 600 who basically become our pipeline for future employees. Ensuring they’re prepared for the future is an important part of what we do.