As a board member and advisor to nonprofits, people often ask me about the roles and responsibilities of board membership. Israel has a long history of organizations engaged in supporting the environment, and Israelis are increasingly serving on boards around the world. I turned to Vipe Desai to better understand the nature of board service because he is the Board Chairman of The Ocean Institute in Dana Point, California.
Vipe Desai is an award-winning executive and thought-leader known for having a sharp eye on the ever-changing consumer dynamics, trends, challenges, and opportunities that help make informed decisions in the boardroom.
With more than 30 years of marketing, branding, and leadership experience, along with 20 years of governance serving on more than a dozen boards, Vipe has a proven track record for leading successful brand launches, organizational change, brand re-positioning, and strategic planning within the boardroom and a passion for inspiring, mobilizing, and empowering support for underserved communities.
Vipe is a dedicated and experienced leader in a host of sectors that spans retail, action sports, commercial real estate, food & beverage, and media.
Today, Vipe focuses on ensuring that future generations are met with a healthy and thriving ocean and is involved with several ventures focused on innovations and solutions that will reduce plastic waste and minimize business’s impact on the planet.
What are the roles and responsibilities of board members?
- Increase efficiency and improve effectiveness
- Crisis and risk management
- Foster innovation and opportunities for growth
- Provide advice and counsel to the CEO
- Talent management
- Ensure that strategy and outcomes align with shareholder/investor/donor objectives
- Governance and compliance
How do boards differ among the public, private companies, and non-profit organizations?
Public and private company boards vs. nonprofit is primarily a tax status, but operationally they should all follow the roles and responsibilities I mentioned above with variations based on whether they’re a private company, public corporation or nonprofit.
In addition, accountability and oversight increase due to the nature of whether an organization is dealing with shareholders, investors, or donors but I always encourage the companies where I serve to always operate at the highest level and operate as a public company. That is where oversight is most critical.
What should a company look for in its board members?
A good board will use a skills matrix to determine which set of skills and experience will help guide the organization’s strategy and governance. In years past, boards mainly were filled with those with deep financial, legal, and individual wealth.
Today, board composition is changing and diversity is at the top of the list – and that diversity includes people of color, gender, age, and broader industry experience.
I’ve also seen studies that have shown diversity in the boardroom is good for the bottom line regardless of whether you’re working with public, private, or nonprofit organizations. Overall, diversity works and is here to stay and will continue to transform boardrooms.
Should board members be compensated?
For public and private companies, board members should be compensated. That compensation can vary depending on the size of the organization. A public or private entity should develop a scalable compensation plan that includes issuing shares, providing monetary compensation, and reimbursement for travel. All three of these compensation plans will help recruit high-quality talent in the boardroom.
For nonprofits, no. This is a way for an experienced executive to do some social good and share their experience and network to advance a critical mission that will benefit society. And in most cases, serving on a nonprofit board may also come with a “give or get” policy which may require board members to either donate a certain amount of money or cause a certain amount to be donated through their network.
What are common conflicts of interest or other problems among board appointees?
Conflicts of interest are rare and are usually flushed out early on in the vetting process, but sometimes a conflict arises while a member is serving on the board. At that point, it is up to the individual and members of the Governance or Executive Committees to determine the level of conflict and if that member should recuse themselves from a decision or discussion.
What does leadership look like in a post-pandemic world?
I’ve seen firsthand how leadership has changed during the pandemic. What it looked like pre-pandemic is different than what it will look like going forward. And this with the leadership in the boardroom.
Leadership style and behavior expectations will include the following:
Trust – this will be at the top of mind for boards and what they expect from CEO’s and those appointed to serve as Chairman of the Board. Trust has to come from the top and flow into the staff and to the consumer and general public. The past few years have shown that trust in government has been eroded, but brand leaders have stepped up in place and that has helped to hold off further erosion of trust in our institutions and democracy.
Collaboration – look for great leaders to build consensus on major decisions rather than going it alone. These collaborations will also include outside organizations and we will see increasing collaborations between brands, nonprofits, and even government agencies. As the old saying goes, teamwork makes the dream work.
Purpose – this is a popular term, but with the social justice movement, climate action efforts, and DEI efforts taking shape, leaders and the brands they’re charged with running cannot sit quietly on the sidelines. They will need to show immense leadership on these issues if they want to grow the bottom line and it will no longer be just about the bottom line. Leaders will need to lead with purpose and be more inclusive.
Empathy – leaders are human, and so are their employees and customers. Smart leaders will use empathy to create a better culture that will help build resiliency when facing challenges.