How to become A Chairperson of the Board of Directors

• Chair of the Board of Directors
• Chairman of the Board of Directors
• Chairwoman of the Board of Directors

What do Chairpersons of the Board of Directors do?

A Chairperson of the Board of Directors would typically need to:

• Provide leadership to the board; ensure that the board is effective in its task of setting and implementing the direction and strategy of the company
• Engage, enable, challenge, encourage, and support the board; establish good governance and set the tone at the top
• Oversee the induction and development of directors; take responsibility for the composition and development of the board; set an agenda and put together a briefing package
• Ensure that the board has full oversight of the organizational business and affairs in light of its legal obligation to the organization, the shareholders, the management, and other stakeholders
• Plan and conduct board meetings effectively; get all directors involved in the work of the board; keep the board focused on its critical tasks
• Resist the temptation to practice team building; instead, practice teaming, i.e., gather experts in temporary groups to solve problems that they may encounter for the first and only time
• Direct wholesome and candid discussions towards the emergence of a consensus view; sum them up so that everyone understands the final decisions
• Engage the board in assessing and improving its performance; ensure the smooth functioning of committees, which are vital to the success of the board
• Provide detailed minutes of all meetings to the board members and key executives, where appropriate
• Act as a direct liaison between the board and the management of the organization, through the Chief Executive Officer (CEO)/Managing Director (MD); support the CEO/MD
• Ensure that the board provides the goals, resources, rules, and accountability required by the CEO; reach out to the CEO for an explanation if there is a delay in implementing a board decision
• Ensure effective communication with shareholders and, where appropriate, the stakeholders, financial analysts, financial press, and debt & equity providers
• Ensure that the business has the right corporate reputation in its community; understand the wider industry and prepare the organization for all eventualities
• Lead and facilitate decisions in crises; have the guts to do what is right for the company

The position may be full-time or part-time. The role is often combined with that of the MD or CEO in smaller companies. However, the joint role is not advisable for public companies listed on the Stock Exchange.

The Chairperson of the Board of Directors would typically have office space at the organization. They may divide their time between physical meetings and tele- or video-conferences with the board, committees, the management, and stakeholders. Their level of engagement depends on the company’s stage in the business cycle, its competitive environment, and the chief executive’s experience.

Travel away from home may be a requirement, depending on the size and scope of your organization. The dress code for a Chairperson of the Board of Directors should be appropriate to the location, sector, size, and type of company in general and also to the particular event they are called upon to attend.

The Board of Directors meets a few times a year. The Chairperson of the Board of Directors may regularly visit the organization according to a schedule agreed upon at the time of appointment. An effective Chairperson should be able to commit 30-40 days a year to the organization.

The board appoints or elects the Chairperson of the Board of Directors.Many board positions are placed through networking, but it is becoming increasingly common for boards to use executive search firms to fill an empty seat.

Chairpersons of the Board of Directors are generally employed by:

• Public Sector Organizations
• Private Sector Organizations
• Listed Companies
• Unlisted Companies
• Small Enterprises
• Medium-Sized Enterprises
• Big Enterprises

Professional associations and organizations are crucial for Chairpersons of the Board of Directors interested in pursuing professional development or connecting with like-minded professionals in their industry or occupation. Membership in one or more adds value to your resume while bolstering your credentials and qualifications.

• Demanding in terms of a long-term commitment of about ten years; ultimate responsibility for board performance; first in the line of firing when things go wrong
• Figuring out exactly which skills are essential; offering strength and support to others while remaining resilient
• Ability to distinguish between when to talk and when to listen; finding your voice and becoming influential

Most companies prefer a candidate who has served as a director or Chairperson of the Board of Directors of another company in the same or a similar industry. For example, financial organizations specifically look for Chairpersons with finance and accounting experience.

How successfully a board or committee meeting runs depends, to a large extent, on the way that the Chairperson conducts it. It comes with experience in steering meetings at the top executive level. There are plenty of rewarding opportunities outside of public company board seats. One way to go is to start in an advisory board or non-executive boards of small businesses. More than often, you do not get paid or are very sparingly paid, but it will build up your experience and enable you to network with other leaders. You can also volunteer to serve on a non-profit board for which you have a passion, such as a local school, sports club, or trade association.

A bachelor’s or master’s degree in one of the following would help you on your way to becoming the Chairperson of the Board of Directors of an organization: business administration and management, business/commerce, entrepreneurship/entrepreneurial studies, finance, international business/trade/commerce, management science, and public administration.

A candidate does not need certification or licensing to be appointed Chairperson of the Board of Directors. However, voluntary certification from an objective and reputed organization can help you gain professional credibility, stand out in a competitive job market, and become an independent consultant.

Successful certification programs protect public welfare by incorporating a Code of Ethics. Investigating members who practice outside the Code earns the community’s trust and respect, which are the most critical elements in securing a Chairperson’s future.

The position of Chairperson of the Board of Directors is usually the pinnacle of a career in management. Advancement may come from a jump to a more reputed company, more generous remuneration, increased perks, and recognition.

There are many pathways to becoming the Chairperson of a board, and there is no better training for the role than being a successful corporate leader. An executive career helps you develop technical skills, reputation, and commercial exposure, thus adding value to the board you lead.

Top executives are expected to face robust competition for jobs.

The Chairperson of the Board of Directors should plan for at least one skills and professional development opportunity during each fiscal year for themselves and the board members.

Great Expectations

The role of the Chairperson of the Board of Directors has become much higher in profile, and the expectations have increased as stakeholders now expect an engaged, energetic, and involved Chairperson who does more than simply manage the corporate governance process.

Most organizations need a Chairperson of the Board of Directors to ensure their success and profitability. The appointment of the Chairperson of the Board of Directors is especially crucial for a business planning an Initial Public Offering (IPO).

The Chairperson of the Board of Directors would significantly enhance the prospects of a successful IPO by building a useful board and calling on their years of experience to ensure that the story a company sells to the market is compelling and real.

What It Takes

An effective Chairperson of the Board of Directors is careful not to allow their personalities to dominate. They are willing to be challenged on their views and enjoy an open debate. Through effective communication, the Chairperson gains the confidence of their Board of Directors and provides clarity in the boardroom. Experienced Chairpersons can quickly identify opportunities and potential risks facing their organization. They can engage with their boards at an early stage to discuss possible courses of action. Seeing the big picture, making realistic assumptions, and connecting them to solutions are abilities that prove critical to the job.

Trust & Transparency

A Chairperson’s success undoubtedly hinges on their relationship with the chief executive. Ideally, it should be based on honesty, trust, transparency, and mutual understanding by both parties of the distinction between their roles. The Chairperson is responsible for and represents the board, while the CEO is responsible for and is the public face of the company.

A Chairperson Supports and Guides Effective

Chairpersons of the Board of Directors must understand the business they are chairing, its culture, people, and processes. They must know enough to ask the right questions and provide a constructive challenge to the chief executive.

One of the main shortcomings of an ineffective Chairperson is their failure to comprehend that they are not there to run the business but to support and guide. In simple terms, the Chairperson’s job is to ensure that the business is well run and not to run the business.

A Fine Line to Walk

There is, however, a fine line to walk between being too involved and being too remote. An effective Chairperson of the Board of Directors should devote the appropriate level of time to their role, which means visiting operations, and talking with the staff, customers, and investors. The best Chairpersons can develop empathy with the business and engage with its people and issues.

Electing a Chairperson of the Board of Directors

A Chairperson of the Board of Directors may be appointed or elected according to organizational rules and customs. Sometimes, in the absence of a designated Chair, a member is elected as Chairperson pro tern (for the time being) to preside over the meet­ing until the regular incumbent can do so.

The word chair has referred to a seat or office of authority since the middle of the 17th century. Its earliest citation dates to 1658–1659, four years after the first citation for chairman.

There is no “one-size-fits-all” prescription for an effective Chairperson of the Board of Directors. What ultimately defines a good Chairperson of the Board of Directors is running an influential board and managing relationships with both shareholders and stakeholders.

Before you are a leader, success is all about growing yourself. When you become a leader, success is all about growing others.