Editor’s note: NACD CEO and president Peter Gleason addressed the audience of the 2018 NACD Global Board Leaders’ Summit on Sunday morning, September 30. What follows is a recap of his comments.
Take a moment and look around—at the person sitting next to you, or behind you. Take a moment to recognize the company you’re in. This is a very significant group of leaders. In this room we hold the means to positively influence virtually everything that affects our world.
We are the key to transformation.
We represent companies of all types: public, private, nonprofit, small, medium, large, mega. Our companies have the know-how, the access, the resources, the infrastructure, and the human capital to discover, design, and innovate to create products and services that can transform everything.
What we do can save lives, protect natural resources, improve education, feed the world, and promote human dignity for all.
There are relatively few of us, but the power here is remarkable. We guide and enable the companies we serve. We create jobs and drive the economy.
We’re also living in a transformative time. Movements have caught fire. Geopolitics and regulatory shifts have altered landscapes. Disruption abounds and innovation either threatens our businesses or beckons us to act. While we often talk about disruption, let’s talk about transformation and how we can use our unique influence to drive it.
In his 2017 letter to shareholders, Larry Fink warned that companies need to demonstrate a strategy for long-term value creation and that understanding a company’s effect on the world is a key component of that strategy. He wrote, “To prosper over time, every company must not only deliver financial performance, but also show how it makes a positive contribution to society.”
Even Dennis Whalen in the Harvard Business Review is commenting on a tighter connection between social capitalism and bottom-line performance, noting that “leadership from the boardroom is essential to making this happen.”
This movement toward transformation represents a convergence of culture, communities, capitalism, and growth, and it starts in the boardroom.
Rest assured that NACD is transforming, too.
We serve you, our members, with tools, insights, and resources—not just to keep you up to date with what’s going on, but to help you get ahead in these turbulent times. Many of our resources explore how people and culture drive company value. If your people are aligned with company values, you get greater performance. Lead the conversation around culture with management and then define your values as an organization. Be proactive with discussions rather than reactive to an event that may define your culture for you.
One element of culture that we’ve focused on for 20 years is diversity. NACD has charted a path toward more diverse and inclusive boardrooms. Simply put, diversity is not a nice to have, it’s a business imperative. And the time is now.
To put our words into action, NACD is unveiling the NACD NXT Initiative.
This is a multiyear initiative to equip boards to better navigate the challenges of the future. In the next decade, boards will be facing questions like these:
- Where will the next generation of board leaders come from?
- What skills will be imperative in terms of board composition?
- How will they learn, network, and capitalize on opportunities?
- What issues will rise to the top?
- How will directors stay current in this dynamic and rapidly changing world?
Many of you were with us last night when we kicked off this initiative with a gala celebrating four companies that represent the kind of transformation we’re aspiring toward. They have not only recognized the importance of diversity and innovation but have also acted on it.
Please join me in congratulating the four winners:
- Newmont Mining Corp.
- Foot Locker
- Liberty Mutual Insurance
Finally, disruption is driving transformation. To survive and thrive in the face of disruption, we need to be adaptive to constant changes. This is the theme of this year’s Blue Ribbon Commission initiative. [You can read The Report of the NACD Blue Ribbon Commission on Adaptive Governance: Board Oversight of Disruptive Risks starting October 1 on our website.]
The opportunities and threats posed by disruptive forces and events have the potential to make or break an organization’s ability to generate sustainable long-term value. The transformation resides in our ability to perceive and respond to unforeseen changes happening around us.
In closing, I want to leave you with this:
- It’s up to us.
- We, the director community, are in a unique position of influence.
- We are, indeed, the key to the transformation we are seeking.
I urge you to make the most of this Summit. Get out of it what you can—there truly is something for everyone. And continue to engage with NACD. We’ve got some exciting things ahead to help you lead with confidence and drive the transformation that our boards, our organizations, and our world needs today.
Thank you, and enjoy the next three days!