Now that the worst of the financial meltdown seems to be behind us and we begin conversations around modernizing our current form of capitalism, boards may begin to contemplate this new normal and what traits for new directors are essential.
Here are my five traits for this new normal:
1. More World-Centric
America’s identity as the most powerful capitalistic market in the world is diminishing. Today, capital is far more available, enabling a number of countries to develop their own versions of free enterprise – efficiency combined with some degree of freedom. Think China and how it has converged ideas, resources and money around the clean energy sector. As this trend continues, the next defining wave of institutions, prosperity, and technology will be outside of the US, be more disbursed in nature and come with its own set of ups and downs.
2. More Diversified Experiences
Candidates with cross-cultural M&A or strategic alliances who have actual experience in business transactions and have gotten their fingers burned will come to the table with keen insights and be more alert. Those that have experienced failures rather than a star-power name have battle-won smarts that far outweigh what is often 10 years of a one-year experience repeated nine times over.
3. More We-Centered
The next round of leaders must be skilled at the ability to find that balance between social responsibility and profitability. Like it or not, as governments fail to fulfill people’s needs, the 21st century boardroom will be faced with this job. Knowing how to work within the tensions that come with the “haves” and “have-nots” is key to public company success.
4. Less Ego-Centric
With the relationship of trust and consumers’ purchase decisions on the rise, the ability to look beyond one’s self and know the difference between self-regard and self-importance will provide the openness for change and flexibly that translates into competitive advantage for the long-term. This is a brilliance that does not need to be showcased.
5. More Ambassadorial
Candidates with contextual intelligence of the intersection of government, business, and culture on a global basis will come to the table with seasoned judgment on collaboration and the risks and rewards of international business. The trend toward resource nationalization, as well as many countries owning and operating large entities, fuels the need for decisive insights that navigate to the upside of turbulent environments with a strategic agility that builds shareholder value.
Today, the drivers of turbulence—rapid diffusion of technology, increased interdependence across markets, and frequency of economic shocks—are driving the demand to retool boards. To create competitive advantage, it will take leaders with a proven agility and “on the ground” smarts built from experience over a staid, lettered approach, nourished by libraries and outdated formulas.