6
European average Number of years on the board
7% Increase since 2011 6% Turnover rate in
the last 4 years
“In short, they (board members) cannot be uncritical lovers but have to be loving critics to the institutions which they are paid to serve.”
For any strategy to be sensibly developed and seen through to execution requires some degree of consistency of personnel. It is interesting, therefore, that the average number of years on boards appears to be increasing. Directors now spend around 7% longer on boards than they did in 2011. On average directors have been on boards for 6 years – the prize for longevity goes to boards in Belgium which has the highest average. “So much depends on longevity of CEO and chairman. The board can focus on strategy if the stability of management is clear,” said one interviewee.
Interestingly, little is known about the impact of a new director on board dynamics. The delicate chemistry of
personalities and viewpoints can easily be undermined. It is important also that boards carefully think through the induction process for new members.
Alternatively, longevity can lead to torpor. According to the Heidrick & Struggles Board Monitor, which tracks board trends in the Fortune 500, the number of new directors appointed over the last four years averages at 317 – a turnover rate of only 6%.
A balance needs to be struck. Around one in five independent directors on European boards have been in their role for more than nine years. Strategic vigour may well diminish with length of service.
Heidrick & Struggles 11
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48