Study Outlines the Most Successful Characteristics for Corporate Boards
In a blog post by the Harvard Law School Forum on Corporate Governance, the authors highlighted a study that identified “Gold Medal Boards” – corporate boards where directors “rate their board’s effectiveness highly (9 or 10 on a 1–10-point scale) and where the company has outperformed relevant TSR benchmarks for at least the last two consecutive years.” The study used 28 measures of effective board culture and behavior covering communication, engagement, relationship building, perspective, and overall character. The 2022 Global Board Culture and Director Behaviors study, conducted by Russell Reynolds Associates, surveyed over 1,100 supervisory board-level directors from more than 41 countries. The study found that while a variety of attributes are important, those that are deemed foundational include directors that are: (1) Prepared and engaged; (2) Current and open; (3) Build trust and respect; (4) Know their role; and, (5) Stakeholder and investor savvy. Meanwhile, high performing directors are those who engage constructively, have sound judgment and relevant expertise, and possess an independent perspective, among other noted characteristics.