If there’s a truism in serving on a board, it’s that the smart money is on just about every one of us reaching our sell-by date and if we don’t read the signs, we can expect the dreaded tap on the shoulder.
Hi, my name is Dr Marcia Hewitt and during a recent chat with Governance Matters’ Kate Costello, we got onto the subject of the shelf life of a board member – and more importantly, how one deals with the perfectly natural feelings of disappointment that come with having to leave a board when you don’t want to go.
We threw a few thoughts around, before Kate thought it would be a good idea if I wrote a guest blog on the prickly issue.
So here goes, with thanks to Kate for some wise counsel along the way…
Kate made the pertinent point that she personally believes nine years is the maximum length of time any one person should serve on any one board. Sadly, not all of us heed this advice, which leads to an inevitable outcome: the honeymoon will end and we will be asked to leave.
We identified four main reasons why a director may be removed from a board:
– Losing an election when up for re-election
– A company takeover, with the new broom keen to sweep clean
– The company reaching a new stage in its evolution and needing new skill sets
– Poor performance
Kate recalled with some mortification how she lost an election as an existing board member of Australian Central Credit Union, complacency in the election process proving her undoing and the result leaving her pretty deflated. A company takeover can be equally disappointing for a director, for the simple reason that no matter how well you’ve performed in the past, the new owners will generally want to put their particular stamp on the entity. They have a vision and a strategy, it’s their money, their business and their call, even if it means losing corporate memory.
In cases where the board has reached an exciting new stage in its evolution, such as internationalisation, and needs new skill sets to take the quantum step forward, you can generally leave with your head held high as the chances are your skills were instrumental in the company’s early development and helped it reach this new juncture.
Where pride perhaps takes a battering is when someone is removed from a directorship due to poor performance. Kate recalls in her board performance evaluation experience how one particular individual who saw they were rated lower than their colleagues on just about measure suggested to the Chair that the sensible thing to do was resign.
Kate couldn’t argue with that!
Of course, regardless of the circumstances, being told go can be devastating. But it’s best in these moments to reflect on the eminently sensible sentiments of former Queensland Treasurer Keith de Lacy, who said life, as much as a career as a non-executive director, should be viewed as a journey and not a destination.
Every journey has its many twists and turns, precisely because it is impossible to have a career without issues, problems and even failures. What’s important is how you respond.
And if you focus on what you do well, your disappointment will fade as new opportunities come along.