The GLOBAL Board: International crises increase the need for non-U.S. board members.

• Author: Hayes, Bill
• Position: A WORLD OF RISK

The global challenges for boards have grown exponentially over the last two years. The constantly evolving relationship between the U.S. and China, Russia's invasion of Ukraine, COVID's continuing effect on global supply chains and the worldwide concern over the effects of climate change are just a few of the issues that suggest American corporate boards could use the perspective of international directors. But why is it worth the extra effort to engage international directors, and what sorts of companies would prosper most by including them on their boards?

DIVERSITY OF THOUGHT AND BACKGROUND

Just as boards can benefit from gender or ethnic diversity, there are many advantages to including directors who can add a global perspective. Selena LaCroix, chair of the compensation committee for Renesas Electronics, board member for NACD's Texas chapter and vice chair of the technology practice for Korn Ferry, explains the benefits. "International directors bring a diversity of skills, experience and approach to a board that will lead to a more well-rounded board of directors. They can also supply the corporation with valuable insights, business contacts and networks that are unique to the geographic areas that they have experience in."

This is echoed by Luis Aguilar, former commissioner at the SEC and board member of Donnelly Financial Solutions Inc. and Envestment Inc., who finds particular value in the insight that international directors bring to boardroom discussions.

"The diversity of thought and experience an international director can bring generates discussions and ideas that can be very useful in helping a board to determine the best solutions or courses of action to enhance stakeholder value." At the same time, finding the international director who is right for your board is not a "one-size-fits-all kind of thing," according to Jan Babiak, who serves as director and audit committee chair for Walgreens Boots Alliance, while acting as an international director herself for both the Bank of Montreal and London's Euromoney Institutional Investor PLC. "Just looking for someone who is international doesn't necessarily bring value. Like you do with any other board metrics, you sit down and look at the skill sets you might be looking for. I think the top benefit is going to come from knowing your business need. That would be my starting point."

WHO BENEFITS?

When asked what sorts of companies would benefit most from the presence of an...