This article originally appeared in Directors & Boards. It is reprinted with permission from MLR Media.

 

As someone who helps executives prepare for board service, I’m often asked, “What are boards looking for?” There is no magic formula. While some skill sets, like financial acumen, are universally valuable, the answer is, in most cases, “It depends.” What constitutes the “right” expertise varies based on a host of factors, including industry, company size, geography, growth stage and strategic priorities. Factors like skill sets and background can help narrow a board’s candidate pool, but once a director is seated, the more important questions becomes, “What does it mean to add value in the boardroom?”That answer is more nuanced, rooted in how board service has evolved over the past several years in response to a rapidly evolving business landscape.

“The profile of who makes an effective director has changed pretty dramatically, driven by the dynamic environment that we’re in,” says James D. White, who serves on the boards of CAVA, The Honest Company, Schnuck Markets, Bay Club and Greenlight. “Whether it’s perma-crises, social issues to be weighed in on or not, or the acceleration of technology-related issues from AI to cyber, all those have created a dramatically different, more rapidly changing environment for boards.” Layer on top of that increased competitive disruption, geopolitical instability, regulatory shifts and economic uncertainty, and it means boards must go beyond the traditional focus on compliance to lead with foresight, fluency across disciplines and a deep sense of service in an increasingly complex operating environment.

From Oversight to Strategic Foresight

While some boards want supply chain or mergers and acquisitions experience, others may look to fill gaps in technology or voice of the customer. But the most telling mark of a director who adds value is not just what they bring into the room, but how they show up. All board members bring their expertise to the table. High-impact directors distinguish themselves by how they apply their knowledge, connecting dots between disparate ideas and applying them across a variety of potential business challenges.

“You need to be at least proficient in a wide range of topics, whether that’s cybersecurity, AI, human capital or world events. You need to have a certain degree of fluency and comfort with some of these issues and to understand how they interact with each other and what the trade-offs are,” says Cory Munchbach, the former CEO of BlueConic and director of Forrester Research Inc.

The most valuable directors bring strategic foresight, not just oversight, says Liat Ben-Zur, who serves on the boards of Talkspace, Compass Group and Splashtop Inc. “They ask, ‘How is this trend — be it AI, regulation or geopolitical disruption — going to affect how we compete? How are we making money and how are our margins shifting?’ They go beyond the material provided in the board book, asking, ‘What assumptions underpin this plan? What could derail it? What signals should we track in the next two, six or 12 months?’”

These questions drive conversations that sharpen accountability, clarify business model risks and deepen the company’s understanding of its competitive differentiation.

Humility and Curiosity Matter

The board’s unique oversight role means they only have partial line of sight into the business. While directors bring a wealth of experience into the room, each company is a unique entity with its own distinct operating details, potential risks, personalities and cultural nuances. The highest-impact directors understand this, balancing their experience with curiosity and a learner’s mindset. They add value by balancing confidence in their abilities with a willingness to “unknow” what they’ve learned.

“When I think about directors who add less or even negative value in the boardroom, it’s those who are anchored in old playbooks — how things have worked in the past,” says Ben-Zur. “We have seen change happen at unprecedented speed in the past couple of years. And often those playbooks are no longer relevant. These legacy thinkers are the ones who you hear dismissing AI or digital-first shifts as fads. ‘Oh, it’s just a fad. I saw this 20 years ago. It’s going to come; it’s going to go.’ They don’t realize that your core business might not change overnight, but it is being disrupted.”

On the other hand, high-value directors bring both humility and agility, questioning assumptions — including, and especially, their own.

“Recognizing that your past experience may no longer be relevant, given how quickly things are changing, is critical,” says Munchbach. “Ten or 20 years ago, being a board member was more about bringing your hands-on experience and operational perspective into the room and applying it to the company on whose board you served. But today, the pace and complexity of change require not just humility about what you don’t know — because you’re not in the trenches — but also the agility and effort to stay current with the business and broader trends in a way that’s more demanding than ever. The level of effort and the higher velocity require you to be even more curious, more humble, more prepared and more on top of things.”

In her best-selling book Daring Greatly: How the Courage to Be Vulnerable Transforms the Way We Live Love, Parent and Lead, researcher Brené Brown shared data showing a person’s courage to be vulnerable about what they don’t know is key to unlocking creativity and innovation. High-value directors understand this. They keep an open mind to new approaches and embrace learning as a continuous and lifelong process.

Lean Into Discomfort

A long-held boardroom maxim is “Disagree without being disagreeable.” While respect and collegiality are critical to building trust and having constructive dialogue, many directors can be so afraid to disrupt the equilibrium that they hold back asking tough or challenging questions.

“Especially in times of volatility and rapid change, really great board members — in spite of the affinity they have for the other board members, the CEO and the C-suite — are willing to lean just enough into discomfort to ensure that the right conversations are happening,” says Christine Heckart, director of SiTime and Contentful, and founder and CEO of Xapa.

She cites boardroom discussions around AI as an example. “On one hand, you may have a company that is just not embracing AI, whatever the set of reasons or excuses. ‘It’s not for us. We’re too small. We’re going to wait. It’s too risky.’ A great director will lean into that discomfort and challenge it just enough to say, ‘Is that really true? Should we be bringing in an expert or two to brief us? Could we understand more how other companies are using it in our industry and what the pros and cons are? Let’s learn together.’”

On the other hand, says Heckart, she has seen scenarios where, driven by excitement and untested assumptions, the leadership team wants to drive full steam ahead on AI. This is where high-value directors slow down the conversation by asking deeper questions about governance frameworks, data provenance, potential risks and expected outcomes tied to data.

Ben-Zur agrees. “I think there’s a higher bar for boards now. The most effective directors respectfully pressure-test assumptions asking, ‘So what exactly has to be true for that forecast to happen?’ Or ‘What are the top three risks that could totally derail the strategy that you’re presenting to us right now?’”

Challenging the enthusiasm or viewpoint of the CEO or other key leaders may feel uncomfortable in the moment, but in a fast-moving environment, sometimes slowing down the dialogue and taking time to surface issues that can help mitigate business risk down the road is precisely what it takes to be a good fiduciary.

Go Outside the Boardroom

Given the more complex and nuanced operating environment, what happens outside of the board meeting can be as critical to adding value as what happens around the table.  High-impact directors add value not just in the boardroom, but through active engagement beyond it — visiting manufacturing sites, immersing themselves in company culture, attending key industry events and viewing the business through the lens of multiple key stakeholders.

White points to his service on the board of CAVA, where directors are expected to spend a day per year on the ground, working in one of the restaurants, and to Schnuck Markets, where ahead of every meeting, the board spends time with one leader from the management team, typically on site at a retail location. In both instances, he says, it brings the challenges of the business home to the boardroom in a way that elevates the dialogue and decision-making.

“It’s valuable on many levels. It makes us more thoughtful in the boardroom as we’re having the conversations, since we’re observing our products from a customer perspective and an employee perspective and can talk about the competition and the challenges from that point of view. It makes us more thoughtful in the boardroom as we’re having the conversations. It creates more empathy and perspective for the pressure points, the challenges and the things that are going well, and it really does make you a more informed director.”

Value Is Subjective

Ultimately, what it means to add value is both subjective and contextual. Knowing what that looks like through the eyes of the board and the leadership is key.

“Each board is unique, and the best directors work to understand the strategy of the company and where they can contribute uniquely,” says White. “The main thing is to engage with the CEO or board chair and really understand from their perspective, and from the perspective of your other board colleagues, where they believe you add value. Sometimes, boards are adding new members to have something change or shift or to have a different perspective in the room, so I want to know that as well. Knowing the importance of board culture, I want to understand how each board director — myself in particular — brings the culture to life in a way that is value-added for the management team and the shareholders of the company.”

Munchbach points to a quote she keeps next to her desk to underscore this point: “You may be right and may not matter here.”

According to Munchbach, “Just because you were invited to join the board doesn’t mean that you are automatically going to be listened to. So, you need to do the work up front to build credibility and reliability. It shows that you’re prepared and that you’re asking good questions. Those are all prerequisites to adding value.”

 

Erin Essenmacher is a partner in Leadership Elevated, an advisory board chair and senior advisor of Athena Alliance, a board member of NXU Inc. and an advisory board member of the Future Directors Institute. She also leads Athena’s Board Readiness Course.