Is HR a part of your board’s winning strategy?
Posted on September 21, 2016
By Joanne Goveas
Too often boards aren’t able to carve out enough time for the HR Committee. It’s easy to forget. And boards know this. On average, boards spend about 11% of their time on talent management, but 53% of directors want to increase that number. So, what’s stopping them?
The challenge is that board directors need to better understand issues such as talent management and succession planning to appreciate how they can add value to the HR Committee. Board directors also need to know how to speak the same language as HR executives so they can collaborate together.
So, what do directors need to know to make their HR Committees more effective?
- Understand current trends and practices in executive compensation
Executive compensation practices change frequently. Board members need to have cross-functional expertise and stay abreast of the latest industry trends to stay competitive.
- Effectively manage CEO succession planning
Succession planning sometimes gets pushed aside until it is suddenly very urgent. Creating smart succession planning strategies not only improves the quality of talent acquisition, it also makes boards more effective.
- Leverage HR Executives
Your HR executive has expertise and insights that can dramatically change outcomes if you know how to work together. Building a strong relationship with your HR executive is key.
- Better understand talent management
Every day, organizations lose talent because there is no clear path to career advancement. The board should engage in talent management strategies that will retain star players who will deliver strong value to shareholders.
- Create a culture at the board level that promotes transparency
Lack of culture or bad culture on boards can be not just toxic to the organization, but deadly. While culture is hard to pin down or define quantitatively, it’s one of the most important factors for board success. Directors must exemplify the values of the organization and increasingly work to improve transparency, which is the best way to communicate values across business units.
And lastly, it’s helpful for board directors to learn more about each of these items, but they can have a much greater impact if they learn them alongside their HR executive. That’s one great step towards building a better relationship and being on the same page, working with the same context on challenges throughout the year. We recommend directors and HR executives pair up to attend Rotman’s Board Human Resources Committee program
to learn together how they can better deliver HR strategy.