Governance education in Canada took root in the early 2000s in the wake of the institutionalized fraud and corruption that plagued North American corporations. Most notably, the Enron scandal that resulted in the loss of billions in pensions and stock prices, and drove the creation of new regulations and legislation to increase accountability, highlighted the need for stronger board governance. Today, organizations and board members are faced with new challenges to innovate, grow, compete, and govern, while operating in a state of unpredictable change. Board leaders must continuously adapt, further develop their skills and learn to innovate and evolve.
Why is governance training so important?
The trends and issues impacting corporate, crown, and non-profit directors have shifted significantly since 2001. Shareholder activism, gender equality, climate change, corporate citizenship, and technological innovation are pushing boards to actively recruit directors who understand the changing risks and opportunities arising from fast moving disruption and to help them to plan forward-thinking agendas and reduce risk. Tomorrow’s directors must know how to lead on the advancement of an innovation agenda, how to protect all stakeholders of an organization, and how to embrace culture as an asset that can support the strategy of the company.
Director training is becoming a necessity for organizations and not just any training, but an immersive experience with education that goes beyond the classroom to incorporate practical application and explore critical aspects of directorship to raise the art and impact of directorship by bringing wisdom, strategic thinking, curiosity, and integrity to the board table.
What should you look for in governance training?
Director education programs should go beyond theory and provide a comprehensive exploration of the structural, cultural, and behavioural aspects of governance. Boards can no longer check boxes, they must have a deep understanding of the organization, and how and where the organization impacts the world and directors need a full understanding of their roles, accountabilities, and responsibilities. At a deeper level, director education programming needs to focus on:
Beyond the composition of individuals, a director education program should include diversity of thought from faculty, alumni, and directors representing a wide range of sectors and board structures to uncover new perspectives and approaches and add energy to group dynamics.
Governance education is wide-ranging and intensive, so having a program that is adaptable to changing schedules and needs can be important to ensure participants have the opportunity to expand their networks and manage day to day obligations.
A director education program should incorporate varied presentation methods and strategies to create engagement with the subject matter, including dynamic lectures, working sessions, case studies, and simulations.
Governance and director education in Canada began as a collaboration between the corporate world and academia, and that partnership continues to create innovative programming for board members. A university accreditation signals a higher level of learning that takes advantage of those innovations and access to quality faculty who are thought leaders in governance.
Director education is an ongoing process that should be supported by additional opportunities to enhance knowledge through continuing education opportunities, events and networking with leaders in the space across sectors.
Training must include an opportunity for directors to transfer their knowledge into action in a meaningful way. Reading about and even debating governance issues is not enough to instill the tenets of solid governance training – it must be simulated in a realistic, controlled, and coachable setting, to have maximum impact.
Does your board have the skills to succeed?
Given the rate of change in an ever-shrinking world, organizations can not afford to seat board members who do not have the training and practical experience required to govern effectively. Poor board compositions, cultures and tactics have caused irreparable damage to the reputations and financial values of large companies over the past few years, but having the right mix of forward thinking, values-driven, and change enabling leaders can mitigate risk.
The Directors College Chartered Director Program (C.Dir.) equips board directors with the skills necessary to bring more to the table as a productive and valued board member. A DeGroote School of Business offering, the Chartered Director Program is the original University Accredited Directors Education Program (DEP) in Canada, in partnership with McMaster University and The Conference Board of Canada.
Originally published in the October 2019 edition of Canadian Business Journal.