Blue Ribbon Commission Report Recommends That Corporate Directors Engage Early and Continually in Dialogue on Strategy
WASHINGTON, Oct. 13 (Korea Bizwire) – The National Association of Corporate Directors (NACD) today announced the release of the Report of the NACD Blue Ribbon Commission on Strategy Development.
The report emphasizes that corporate directors should not limit their engagement in strategy development to annual discussions with management or crisis situations. It recommends that directors recognize that board engagement on strategy is a continual process, and issues related to strategy should be the central focus of board activity year-round.
“Boards must expect that the company will need to make alterations to its current strategy at some point in its life cycle,” said Maggie Wilderotter, chairman and CEO, Frontier Communications Corp.; director, Xerox Corp., Procter & Gamble, The Committee of 200; Catalyst; and co-chair of the commission. “Understanding the assumptions underlying the strategy and recognizing when they are no longer valid will help directors successfully lead through periods of change.”
The Report of the NACD Blue Ribbon Commission on Strategy Development discusses why boards should reassess how they approach their role in strategy, and provides a framework for earlier board engagement in the company’s strategy formulation, and tips for changing the rhythm of the board’s dialogue with management on strategy. Additionally, the report addresses what is needed from the board to support continual oversight of strategy development, execution, course correction, and related information and control systems.
“For the past 10 years, boards have become more involved in strategy–and directors want to spend even more time on the topic. The growing practice of overscheduled board agendas often makes this difficult, however,” said Raymond Gilmartin, former chairman, president, and CEO of Merck & Co.; director, NACD; and co-chair of the commission. “We need fewer presentations during board meetings and more discussion between the board and management on the competitive threats facing the company.”
The report offers 10 recommendations for directors to consider as they recalibrate the traditional dialogue on strategy between the board and management, and deepen their engagement in the strategy process. It also details the potential barriers to changing the dialogue on strategy.
“This publication is going to be an important contribution to changing board perspectives on strategy,” said Ken Daly, president and CEO of NACD. “It draws on the experience of the Blue Ribbon Commissioners and NACD research to offer guidance on how directors can be active participants in strategy development without crossing the line into management.”
The Report of the NACD Blue Ribbon Commission on Strategy Development is exclusively available to NACD members and can be found at www.NACDonline.org/Strategy.
Other members of the NACD Blue Ribbon Commission include*:
— Gerry Czarnecki: director, State Farm Mutual Automobile Insurance Co.,
State Farm Bank
— Ken Daly: president and CEO, NACD
— The Hon. Cari M. Dominguez: director, ManpowerGroup Inc., Triple-S
Management Corp., NACD
— Nicholas Donofrio: director, Advanced Micro Devices, Delphi Automotive,
Bank of New York Mellon
— Charles M. Elson: director, HealthSouth Corp.
— The Hon. Barbara Hackman Franklin: director, Aetna Inc.
— Joseph Fuller: director, PVH Corp.
— Peter Gleason: managing director and CFO, NACD
— Holly Gregory: partner, Sidley Austin
— Janet Hill: director, Carlyle Group, Dean Foods Inc., Echo360 Inc., The
— Michele J. Hooper, director: UnitedHealth Group, PPG Industries, NACD
— Reatha Clark King: chair, NACD
— Greg Lau: director, NACD
— Sara Mathew: director, Campbell Soup Co., Avon Products Inc., Freddie Mac
— Alan McIntyre: managing partner for North America, Oliver Wyman
— David Nadler: principal and co-founder, Nadler Advisory Services
— Patricia Russo: director, General Motors Co., Hewlett-Packard Co., Merck
& Co., Alcoa Inc., KKR & Co.
— Brian L. Schorr: partner and chief legal officer, Trian Partners
— Steven Van Putten: managing director, Pearl Meyer & Partners
— Dennis Whalen: partner-in-charge and executive director, KPMG’s Audit
— John Wood: vice chairman and member of CEO and Board of Directors
Practice, Heidrick & Struggles
*This list may not include all directorships for each commissioner.
The National Association of Corporate Directors (NACD) is the recognized authority focused on advancing exemplary board leadership and establishing leading boardroom practices. Informed by more than 35 years of experience, NACD delivers insights and resources that more than 15,000 corporate director members rely upon to make sound strategic decisions and confidently confront complex business challenges. NACD provides world-class director education programs, national peer-exchange forums, and proprietary research to promote director professionalism, ultimately enhancing the economic sustainability of the enterprise and bolstering stakeholder confidence. Fostering collaboration among directors, investors, and governance stakeholders, NACD is shaping the future of board leadership. To learn more about NACD, visit www.NACDonline.org. To become an NACD member, contact Kelly Dodd at kkdodd@NACDonline.org or 202-380-1891.
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Source: NACD via Globe Newswire