I met my podcast partner for this episode when conducting a board evaluation for a growth company in the Financial Services sector.
I met my podcast partner for this episode when conducting a board evaluation for a growth company in the Financial Services sector. What struck me was the positive view everyone on the board had about how the board works together. We have detailed benchmark data, and also, when we compared this board with others, it came out as one that is performing better. So, I immediately thought I must invite the Chair, Peter Herbert.
So here we are. I am delighted to talk with Peter. Peter is a Non-Executive Director and Adviser, chairing the Board of Bank of Ireland (UK) plc and Zopa Bank, the banking subsidiary of Zopa Group, where he also sits on the Group Board. He is also a Non-Executive Director of WiZink Bank, where he chairs the Appointments & Remuneration Committee. Previously he was a Non-Executive Director and then Chief Executive Officer of Tandem.
Some of the key takeaways of the conversation include:
With over 40 years of experience in banking and financial services internationally, his extensive career includes managing complex business portfolios and holding senior C-suit positions with Barclays, GE Capital, GE Money Bank, and the National Bank of Kuwait in Europe and the Middle East and Asia.
“Being an effective board is a team game”
Peter emphasises the importance of teamwork on a board, stating how there is no room for ego or disruptive behaviour. However, this is not the same as a ‘groupthink’ approach or not challenging other board members when necessary.
He feels that as a “conductor” of the board, a Chair is responsible for a board focusing on shared goals and ensuring board processes run smoothly and effectively. This can include board members getting the chance to express their views, making sure the board gets through the agenda in the allotted time and handling differences of opinion. Also, ensuring non-executive members are given time to provide feedback on how effective the board meeting went and what could be improved.
He feels that it is the role of the Chair to ensure that the board as a collective is greater than the sum of its parts, drawing on the diverse skills and experience around the boardroom table.
“Who isn’t motivated by building a successful business?”
Peter believes that working with growth businesses is both fun and motivating. Still, he cautions about managing growth, especially where these businesses have private equity investors, who can be demanding owners.
He approaches joining a growth company in the same way as joining other boards, in the sense that you need to get to know board colleagues as individuals, looking at what works and what needs to change. This helps to draw up what Peter refers to as a “prioritised development plan.”
Quoting from Patrick Dunn’s book, Peter says that the role and purpose of a board is to ensure there is the right vision, purpose, and strategy and the right resources and governance to achieve them. He also thinks having the right culture is necessary. From a board point of view, the nature of each of those components is likely to be different in a growth or restructuring business, but in both cases, the same components are necessary.
He also believes in the need to ensure a shared understanding of the challenges facing the firm and how the board can help with these. This can include looking at where people’s priorities lie and how to fill potential resourcing gaps. Peter then talks about spending time with management and their teams, emphasising how this can help board members better understand the challenges they are facing daily.
He admits that the recent COVID-19 restrictions over the last 18 months have made this approach more challenging, and this may have had a negative impact on board effectiveness. He believes that this is something companies need to look at to rebuild personal bonds with their management teams.
“Being a good board colleague is the key thing”
Peter emphasises the importance of being a good board colleague, which involves listening carefully, constructively putting your point across, building good relationships with your stakeholders and not making assumptions. He believes that this approach should apply to all board members and not just the Chair.
Peter feels this is a less visible part of a chair’s role and that frequent interaction can be crucial, especially before big decisions need to be made. He believes this is important, so you know what thoughts people bring when they go into a board meeting.
He points out that this often needs to be done outside meetings, otherwise, the quality of a meeting can be less effective. This extends to stakeholders (especially within a growth business), as knowing what they are concerned about can enable the Chair to bring people together with a single focused goal going forward.
“A good company secretary and their team is worth their weight in gold”
Peter feels that a Company Secretary and their team are worth their weight in gold, and that frequent and open dialogue with them is vital. He stated how they could spot potential pitfalls, going through meeting agendas and producing concise, accurate meeting minutes that can be very important, especially in a regulated business.
“Oversight of the effective execution and implementation of strategy is also a key role of the board”
Peter describes that most businesses have periodic strategy sessions because strategy isn’t a static topic. Instead, strategy evolves as new facts become known or you learn things you didn’t know before. He believes that one way to address this point is to have a standing strategy item on every board agenda, where the board can discuss such matters regularly.
He sometimes finds that it can be helpful to remind board colleagues that oversight of the effective execution and implementation of strategy is a key role of the board.
The three top takeaways from our conversation are:
- Boards should not overcomplicate their role
- Working as a chair can be daunting and hard work, but also fun
- There is no silver bullet- boards need to have the right people, work together and have supportive, effective processes to make the board function effectively
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