IMHO: I don't care where, as long as I'm chair

OPINION: In the 1990s, Sir Tim Shadbolt captured public attention with his memorable television advertising campaign, boldly declaring: “I don’t care where, as long as I’m mayor.” 

Shadbolt was mayor of Waitemata City in Auckland before heading to the deep south to become mayor of Invercargill (after losing mayoral elections in Waitakere City and Auckland City along the way). His tongue-in-cheek slogan played on a misconception that being a successful mayor in one city meant he could repeat the feat anywhere. This is a misconception that can also occur when we think about board members.

Just as not every mayor is right for every city, not every individual director is suited to every organisation. Governance requires a strategic fit between the board's composition and the specific needs of the organisation, ensuring the organisation is guided effectively through its unique challenges and opportunities.

Boards in New Zealand face ever-changing business environments where one thing remains constant – the need for the right people around the board table. As organisations evolve, directors must understand that board composition should align with the specific season, strategy and challenges the company faces at any given time. Not every board can be simply "cut and pasted" across to a different organisation, and not every director is suitable for every company, either.

In essence, ensuring a board is effective is not just about meeting a generic board skills matrix, but crafting a collective governance leadership team that serves the company’s unique strategic needs. 

Board composition is a strategic tool

Board composition is more than the sum of individual directors’ expertise; it is about creating a collective capability that can drive long-term success. Directors must critically assess how the current composition aligns with the company’s strategic direction and whether the board – as a whole – can provide oversight and guidance through different business cycles.

Different organisations face different challenges – whether it's a high-growth start-up needing innovation, or a mature business managing risk and compliance in a heavily regulated industry. As noted in the Four Pillars of Governance Best Practice, the board must have "the skills, diversity, and experiences to provide sound governance" for its specific context.

For example, a company in a growth phase may benefit from directors with experience in scaling businesses, digital innovation or entering new markets. By contrast, a mature or highly regulated business may need directors with a strong understanding of risk management and regulatory compliance. The mix of skills and experiences must mirror the company’s current and future priorities, ensuring the board can address both immediate challenges and longer-term objectives.

Board composition and organisational seasons

Every organisation passes through different “seasons” of its business lifecycle. These could range from start-up and growth to consolidation or even turnaround scenarios. Each phase presents distinct governance needs.

• • Growth phase: This may require directors with skills in innovation, technology and expansion. The board must be agile and forward thinking, with directors who understand the dynamics of rapid change and are comfortable navigating risk.
  • Mature phase: Directors with expertise in governance, risk and compliance are essential, particularly as companies face increasing scrutiny from regulators and stakeholders. A deeper focus on ESG (environmental, social and governance) factors is crucial as mature companies come under more pressure to demonstrate sustainable business practices.
  • Turnaround or crisis: In tough times, companies need directors who are skilled in restructuring, stakeholder communication and crisis management. Experience in navigating corporate crises or previous turnaround situations can be invaluable.

The right board composition reflects not only the organisation’s current situation but also its future trajectory.

Not every director fits 

Just as no two organisations are the same, not every director will be the right fit for every board. The idea of "fit" is particularly important when it comes to aligning personal values, experience and style with the company’s strategy and culture.

Directors may bring valuable expertise in areas such as finance, lega, or marketing, but that doesn’t necessarily mean they are well-suited to serve on just any board. The board dynamic, organisational culture, and strategic priorities must match the director’s skills, experiences and governance style.

Boards should avoid appointing directors based solely on reputation or familiarity. While "shoulder tapping" can be a quick method of recruitment, it often results in like-minded boards that may lack the diversity of thought needed for robust decision making. An appointment based on who is known, rather than who is needed, could risk board homogeneity and groupthink. 

As part of long-term succession planning, boards should evaluate their skills mix through regular reviews. Building a future-ready board means embracing diversity – of thought, gender, ethnicity, skills and experience. Boards that actively seek diversity are more likely to avoid groupthink, improve problem-solving, and produce better decisions.

• • Conduct regular skills audits: Assess the current skills and experience on the board. A skills matrix can help identify gaps in knowledge, ensuring that the board remains aligned with the company’s evolving strategy. This needs to be conducted honestly and objectively – when was the last time you saw a board skills matrix where the current board admitted they had some large skills gaps? 
  • Tailor recruitment to strategic needs: the appointment of every new director should be guided by expectations of the company’s future needs. Avoid the temptation to recruit based on personal connections or past roles. Focus on what the company needs for the next phase of its growth. As a candidate, this might mean that you are not the right fit for that board even if you are a great director. If you are too similar to an existing sitting director or don’t meet a strategic skills gap then it is not your time for that board. 
  • Foster a culture of continuous learning: Directors should be encouraged to engage in continuing professional development (CPD) to keep up with emerging trends in governance, technology and business. This ensures that the board can provide informed oversight in a fast-changing world. We need to grow our own capability and skills as a board group and not just rely on one new board member being the expert in a new area.
  • Embrace succession planning: Plan ahead for board transitions. Succession planning should not be an afterthought but an ongoing process that ensures the board remains dynamic and capable of leading the organisation through all its seasons.

Matching board composition to the organisation’s current season and strategic direction is a key governance responsibility. Boards must be intentional about the mix of skills, experiences, and perspectives they bring to the table. While not every director will be the right fit for every board, having a forward-thinking approach to recruitment, development, and succession planning will ensure that the board remains relevant and effective in serving the company’s long-term goals.

AI assisted in the creation of this article.

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KP is the Chief Executive of the Institute of Directors. She is a qualified lawyer and a Distinguished Fellow of the Human Resources Institute of New Zealand. Her governance roles include:

Chair, Global Network of Directors Institutes (GNDI)
Chair, Brian Picot Ethical Leadership advisory board
Trustee, Voices of Hope
Board member, XRAP Advisory Panel, External Reporting Board (XRB)
Ambassador, Wellington Homeless Women’s Trust. 
With extensive governance and leadership experience, she is actively involved in community initiatives.

A strong advocate of diversity, KP was also a founding member of Global Women’s ‘Champions for Change’, a group of senior executives and directors who commit to diversity in the workplace, and a founding member of WiSPA, an organisation promoting women in sport, and mentors a number of business leaders. KP was also previously Director of the NZ Rugby Foundation.