Nomination Committee Strategies

Dr. Earl R. Smith II
Managing Partner, The Federal Circle
DrSmith@Dr-Smith.com
Dr-Smith.com

The Nomination committee advises the board of directors regarding new board members. It has the power and authority to change board composition which in essence will change how the board functions as a unit. The Nomination committee must work year round with regular meetings, necessary resources and members with insight into how the board works.

The Nomination committee should be a standing committee with regularly scheduled meetings. Members of the committee have a responsibility to the board to be prepared to recommend a new board member in the event of a resignation or board member debilitation or demise. Finding highly capable board members requires extensive vetting well beyond educational attainment. Committee members need to understand the leadership style of potential candidates – how their style will work with existing board members.

Members of the Nomination committee should have in depth knowledge of the following:

• Corporate strategy: understanding the direction the board intends to take the organization will assist the Nomination committee in determining necessary skills and expertise required of candidates to maximize board performance
• Corporate culture: new board members should adhere to the corporate culture of the board they are joining. The Nomination committee should carefully vet potential candidates with personalities or work histories that may not be compatible with their organization.
• Board member leadership styles: boards must have a balance of board members regarding leadership styles. They must be able to work together effectively, and lead the organization to achieve the corporate strategy
• Corporate management succession plan: the Nomination committee and the Succession committee should work cooperatively to ensure a strong line of leadership candidates is available to lead the organization

The Nomination committee must have access to corporate management evaluations and board evaluations. Comparing both sets of evaluations will allow the committee to better judge the type of director needed to bridge potential knowledge gaps or missing or weak skills on the board. After conducting a detailed assessment of evaluations, the committee should establish criteria for the skills needed in new board members.

The Nomination committee should also have access to an outside adviser with expertise in industry talent recruitment. The committee should interview several outside recruitment firms and ensure the firm selected has no conflict of interest such as ties to a competitor. If a recruitment firm is hired, the committee should negotiate a contract that includes the criteria for all potential candidates. The criteria may be a multitiered. The various tiers would reflect the various needs of the board.

Once a list of candidates is vetted on paper, the Nomination committee should establish an interviews schedule. Potential candidates should be confident, assertive and yet respectful of others. The committee should interview potential candidates and make an assessment of their interpersonal skills, leadership style, and communication ability.

The Nomination committee should review the interviews and establish a short list of candidates who most closely match the established criteria. The ‘short list’ candidates meet with the CEO and review the non-confidential but critical challenges the board will be asked to face in the near future. All potential candidates should have a general idea of the time commitment, and challenges of their board service.

The next step should be a meeting with the full board usually in a non-business setting. In the Sarbanes-Oxley era, most board members demand an opportunity to visit with potential new board members prior to voting to accept them onto the board. Federal regulations and court interpretation of board liability has made many board members much more discriminating on who they are willing to serve with. Board composition is vital to how a board functions.

© Dr. Earl R. Smith II

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Related Articles:

• Characteristics of a Task Oriented Director
• New Board Member Selection
• Officer and Director Vetting
• The CEO’s role in board member selection
• Board Succession Planning – Two Tiered Candidate Criteria
• Good Governance – Board Member Selection Criteria

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