Should NZ Companies have international board members?
Amal Johnson who is based in San Francisco has extensive experience in the high-tech industry, from Application Software to Cloud Computing and Hosted Services. She is currently the Executive Chairman of the Board of Author-IT, a New Zealand based Software as a Service private company. She also serves on the boards of Mellanox Technologies (MLNX), and Intuitive Surgical Inc (ISRG), and she is a venture advisor to Illuminate Ventures.
In 2008, Amal was recognized by The Corporate Board Member Magazine as one of the top 50 women in Technology, and in 2011, she was voted “one of The Most Influential Women in Bay Area Business by the San Francisco Business Times”.
Amal talks to Henri Eliot on her thoughts on corporate governance for NZ companies seeking international board members.
What is the role of a board from your perspective?
The main role for the board is to set the long term strategic direction for the company and to assemble the right management team to execute the strategy.
That being said, short term activities of the board are influenced by the nature of the company. Private companies may need more operational help from the board than public companies who require more governance and compliance work. Family owned companies have their own specific needs and nonprofit companies may require fund raising assistance from their boards.
Looking forward 5 years, how do you think the board dynamic will change?
Diversity will be a major focus for International boards in the next five years–diversity of background, skills, age, and particularly gender. Today 15.7% of the Fortune 500 companies in the US are women. In Europe it’s 9.7%. Research indicates that companies with more women on their corporate board see greater increases in their financial performance compared to companies with fewer or no women directors. We are seeing many countries impose a gender quota for their public companies. As an example, Australia currently requires that 40% of all major crown corporation board seats go to women. This diversification will change the dynamics of the board as women bring a diversity of thought and a fresh perspective to the boardroom
How will the next generation of board members differ and operate?
To serve on an international public company board, directors must have served in senior operating roles. CEO’s and CFO’s are especially in demand to serve as Chairs of Compensation, Governance and Audit Committees. With the current focus on risk and security, boards will be adding technical members to help navigate these new challenges. In addition, Social Media is changing the ways companies reach out to their consumers and clients. Executives with extensive experience in this area will also be recruited to the boards.
How are we preparing the next generation board member for the future?
Senior operating executives usually participate in quarterly board meetings and board strategic planning sessions. This enables them to observe the board dynamics and participate in the discussion. In addition, as the Board and the CEO focus on succession planning and mentoring the next generation of talent for the company, they seek outside board opportunities and sponsor these individuals to serve on outside boards.
What gives you the most sense of achievement on a board?
I enjoy my board work for a number of reasons. Working with smart, talented and accomplished board members and executive teams is truly a privilege. I have the good fortune to serve on the boards of multiple companies in a variety of industries, each with its unique opportunities and challenges. Currently I’m on the board of …Author-IT, a New Zealand software company, Mellanox, an Israeli semiconductor company and Intuitive Surgical a Silicon Valley medical device company. This variety of industries and geographies has offered me enriching experiences. Also, I have a personal interest in mentoring young CEO’s and watching them develop through the different stages of the company growth.
At various times, all companies will face serious challenges. Those are the times when the board and management need to collaborate to navigate thru the crises. As a board member, I’m able to contribute my background and skills to help achieve a positive outcome. That’s when I feel the most sense of accomplishment.
What do you read for business?
Daily, I read the local Silicon Valley Newspaper the San Jose Mercury News in addition to the Wall Street Journal. Weekly I subscribe to the Economist and the Sunday New York Times. Throughout the week, I receive alerts on topics or companies I’m interested in.
Currently I’m reading “The Next 100 Years” by George Friedman.
Henri Eliot is chief executive of Board Dynamics, a consultancy company which provides strategic advice to directors and boards throughout New Zealand and Australia.