The board director role is increasingly demanding, according to Frithjof Lund, the global leader of McKinsey’s Board Services practice. “New topics pile onto the board agenda almost by the day,” Mr. Lund said. “We’ve also seen a massive increase in the expectations of the board to engage on strategy, investments and M&A, performance management, risk, talent, and the organization.”
Mr. Lund and other McKinsey subject matter experts weighed in on the growing demands of board governance in an episode of the consulting firm’s Inside the Strategy Room podcast. Board directors have long been responsible for guiding the strategic direction of a company, but the work is now spilling outside of traditional bounds, with many boards having increased contact with management teams outside of four meetings per year.
The broadening scope of issues, decision-making and topics in front of boards necessitates more time from members and directors, with 32 to 33 days per year in total now invested toward their commitments, according to Mr. Lund. Boards of private equity-backed companies spend nearly twice the amount of time as public company boards.
Longer meetings, more rigorous prep work, and more frequent calls between board meetings suggest that board service today requires a different level of engagement than it once did. The conventional approach where boards served as a final career stage before an executive’s retirement doesn’t align well with growing demands for those in the role.
Before the growing issue of burnout, boards have long grappled with passive and disengaged members. Here are 10 signs of a board member who is effectively governing and adding value.
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