For companies seeking individuals to appoint as members of their Board of Directors, a common source is the pool of CEOs approaching retirement. Many professionals, including entrepreneurs, often assume that “there is no life after retirement.” In reality, vast opportunities exist to leverage one’s skills and experiences in boardrooms.
Are these roles equal or similar?
Both roles involve leadership, strategy, analytical skills, and decision-making responsibilities, However, while they may appear similar, transitioning from the C suite to the B suite necessitates a significant mindset shift. This transition requires moving from a focus on operational concerns to adopting a broader oversight role, given the change in responsibilities.
Here are some key differences:
Operational vs Strategic: A CEO is primarily concerned with executing the strategies for the organization outlined by the board, while the board must “think big” and monitor the overall progress and direction of the long-term strategy to ensure growth and sustainability.
Day-to-day vs Comprehensive: CEO decisions are “hands-on” and made to keep operations moving, whereas board decisions are broader and impact long-term progress.
Individual vs Collective: A CEO’s authority is individual and hierarchical, flowing from top down. In contrast, board decisions are collective, requiring each member to deliberate on issues and provide input that can integrate with others’ perspectives.
Direction vs Guidance: CEOs ensure alignment with the organization’s goals, while the board provides oversight, balancing the interest of management and its stakeholders, guiding management without directly leading the organization.
HOW TO TRANSITION FROM CEO TO BOARD MEMBER?The journey from CEO to board member is not merely a change in title but a profound shift in role, responsibilities, and perspectives. How does one prepare to be a board member?
Ernst & Young (EY), one of the world’s largest professional services organizations with over 400,000 people across 150 countries, has recognized the potential of its partners to become board members. To support this transition, they launched the “EY Journey to the Boardroom” program in partnership with Harvard Business Publishing. This program aims to equip EY partners with the necessary skills to prepare for and pursue corporate board positions while enhancing their existing client and advisory relationships. The course focuses on global and corporate issues within the context of today’s boards. Participants engage with EY experts, HBS faculty, and peers to complete individual and group assignments. As an Alumni Partner of SGV & Co., a member practice of EY Global, I had the privilege of participating as a resource person on several panels alongside EY alumni partners from other countries.
A question frequently posed to the panel is, “What mindset shift is necessary when transitioning from EY Partner to board member?” My response to this question encompasses my five C’s below.
Challenge. Especially for non-executive and independent board members with limited involvement in day-to-day operations, it is good practice to challenge “elegantly and with respect” matters presented and discussed for decision-making. While it requires experience and preparation to ask difficult questions, this should not deter you from doing so, as it enhances board discussions and ensures that all aspects of the matter are considered. However, board members must also be open to being challenged on their positions and opinions, allowing others to share their views.
Contribute. Posing challenges in board discussions is only valuable if they are constructive and contribute potential solutions. Taking on a board role involves redefining one’s contribution to the organization, fostering a supportive environment for management, and championing a strategic rather than operational outlook. Remaining engaged without overstepping your bounds allows you to contribute effectively to the board discussions while respecting the boundaries of the CEO and executive team.
Collaborate. Board members act as checks and balances, ensuring the company remains accountable to shareholders and maintains a clear direction. To fulfill this role, you need to work with management and other board members towards achieving a common goal. Understanding the intricate dynamics of group decision-making and consensus-building is crucial, as intertwining your expertise with others enhances your ability to contribute effectively to discussions. Establishing strong relationships fosters a more harmonious and productive board.
Communicate. Effective communication is essential for the success of any board. Ideally, boards should promote transparency and accountability in their communication channels, define clear objectives, and encourage active listening and constructive dialogue. Leading communication expert Dianna Booher gives two tips to be a better communicator: 1. “Listen for what is not said in a conversation or document”; 2. “Listen discriminately and probe with questions to help draw conclusions about what you hear so you can make sound decisions.”
Be Curious. Walt Whitman, the American poet and essayist, advised us to “be curious, not judgmental.” PwC’s recent survey of over 1,000 CEOs indicates that “curiosity” and “open-mindedness,” or the “curiosity quotient,” are becoming increasingly critical leadership traits in challenging times and in managing complexity. Psychologist Diane Dreher notes that “curiosity is positively correlated with creativity, intelligence, problem-solving ability, autonomy, a sense of personal control, and a willingness to challenge the status quo,” all of which are foundational to a director’s role.
Transitioning from the C Suite to the B Suite presents new personal challenges that require the development of knowledge and skills tailored to the new position. While this shift may seem daunting, it represents a tremendous opportunity for seasoned leaders to impart wisdom and guide a company from a fresh vantage point, ensuring its enduring success and integrity.
The journey from the C suite to the B suite is not merely a change in title; it is a transformation in perspective and responsibility. Embracing this transition with the right mindset, coupled with the five C’s — Challenge, Contribute, Collaborate, Communicate, and be Curious — will equip you to navigate your new role effectively. By fostering a culture of open dialogue and mutual respect, you can enhance the board’s effectiveness and help steer the organization toward a sustainable future.
This article reflects the personal opinion of the author and does not reflect the official stand of the Management Association of the Philippines or MAP.
Ma. Aurora “Boots” D. Geotina-Garcia is a member of the MAP Diversity, Equity & Inclusion Committee. She is the founding chair of Philippine Women’s Economic Network or PhilWEN, and chair of the Governing Council of the Philippine Business Coalition for Women Empowerment or PBCWE. She is also president of Mageo Consulting, Inc., a corporate finance advisory firm.