Educating the board: HR plays an increasingly vital role in helping directors gain the skills and experience they need to oversee complex corporate activities

HR Magazine, Feb, 2005 by Susan J. Wells

Evaluating the Options

Generally, there are three prongs to an effective director education program for both new and existing directors: orientation and briefings on the company; in-house meetings with senior management and selected speakers or consultants; and outside open enrollment in training seminars, courses and lectures, where larger numbers of directors gather to learn about current and best practices.

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At a minimum, experts say, directors should expect to become well-versed in:

* The main drivers of the business.

* Major strengths, weaknesses, opportunities and threats.

* The company's financial management and reporting.

* The regulatory and legal environments.

* The investment environment.

* Key people and talent issues.

Not surprisingly, the push for director training has spawned a budding cottage industry of high-level education resources. The expanding supply of programs range from multi-day university-based seminars, courses and conferences to one-on-one coaching to in-house training sessions. (For more information about in-house training, see "Customized, In-House Programs Gain a Following" on page 50. For a comprehensive list of accredited programs, see the online version of this article.)

And they're growing all the time: NACD, which already offers a series of director education courses, in-house programs and online instruction, plans to formally launch its own education initiative, the NACD Corporate Directors Institute, in fall 2005, Gleason says. The program will offer a certificate of director education and professionalism for those who complete a 16-hour governance course.

When selecting from the wide array of education options available, take into account the nature of the company's business as well as the personalities, strengths, weaknesses and inevitable time constraints of board members, say experts.

HR and the corporate leaders they work with should evaluate choices carefully, says Dr. Carolyn Kay Brancato, director of The Conference Board's Global Corporate Governance Research Center and Directors' Institute, a provider of governance education for directors. Since its launch last year, about 150 directors representing 300 boards have attended Institute sessions, which are offered as open seminars and in-house courses, she says.

When selecting between providers, weigh such factors as the quality of the instructors, the organization's experience and track record in providing such governance guidance, current relevance to the needs of the board members, costs and whether the session can be held on-site for board members, says Brancato.

You also must take into account the networking needs and preferences of board members. The Directors' Institute's one-day programs, for example, accept only sitting corporate directors--it does not invite other corporate executives. "We've found that directors only want to sit with other directors--chiefly for the commonality of experiences and challenges," she says.

Getting the Call

It pays to be ready because you never know when you'll be asked to get involved in board education.