Governance at the Speed of Change: The Modern Board

Welcome to Leadership Reimagined, where game changing conversations are reshaping the world of work. I'm Janice La, CEO and founder of LA Group, Executive Search Advisors and pioneers in redefining executive search through our unwavering commitment to helping organizations hire outstanding executives to build inclusive environments. Today on Leadership Reimagine, our topic, a very important one is governance at the speed of change, the Modern Board. I am honored to welcome Richard K.

Davis, who started his career at the age of seventeen as a bank teller and then went on to become the president, CEO and executive chair of US Bank Corp. In two thousand and seven, a position he held for over a decade until twenty eighteen. With over forty years in banking, Richard is one of the industry's most renowned and respected leaders, having served as Chair of the Financial Services Roundtable, Chair of the Consumer Bankers Association, Chair of the Clearinghouse, and Representative for the ninth District of the Federal Reserve, where he was president of its Financial Advisory Committee.

Known for leading with purpose and a strong moral compass, and after a stellar career as CEO and chair for US Bank. Richard later turned his focus to the non profit world, becoming President and CEO of the Make a Wish Foundation. After serving in that capacity for four years, Richard continued his extensive boardwork, which currently includes serving on the boards of Wells Fargo, MasterCard, and DOW, where he is the lead director. He previously served on the BOYD to Excel Energy and DTCC, in addition to serving for more than thirty years on a variety of nonprofit boards, including his current service as chair of the Mayo Clinic.

Richard, I am delighted to welcome you here today and thank you for coming back to do a second podcast, the prior one on your career in banking and of course then Make a Wish, and now to talk about corporate governance and given you been a CEO, working with your own board, as a director across a variety of sectors in multiple boards, and being recognized as the most admired director on the Wall Street Journal Top two hundred and fifty board directors, you are the right person to talk on this subject, So thank you for being here with us today.

Thank you, Jannis. I'm very happy to be here and I'm delighted to be invited back twice. That's a good signed. Well, you know, this is a crucial topic and everybody's talking about it in terms of how to navigate during these times of disruption and shifting sands, and how to be an effective board member.

And those who are current board directors, those that are incoming directors, and many of the aspiring board directors that come through my Board Academy boot camp, and there have been over one hundred over the past two years, they're really looking for guidance on how to be an effective board director and what does it take to be effective? What are the skills you need? What are they Richard well Jannis, First of all, thanks for tutoring so many people and helping people be better governors.

Let's start with what's essential. There are three key things that a good board member needs to be mindful of every once while toggle from for profit to for mission, just to distinguish the two. But first and foremost shareholder stewardship. Each board member is voted on annually by the shareholders and there's roughly a dozen or so directors at each company that are responsible for millions and billions of shareholder investments.

So number one, don't forget your role as a shareholder steward. Number two, remember you're part of a team. This is a team sport, so you are part of at called the board of directors where your contributions are part of a larger group, and it's not a singular activity but one of being part of a team. And then finally, and as importantly, you're a governor for the CEO and senior management, not a manager.

You're a governor. And if you are a shareholder steward in a for profit company elected annually. On the other hand, if you are working for for mission or not for profit, you're actually a volunteer. And oddly enough, in the for profit space you're paid handsomely for the responsibility of a corporate director, and in the form mission space you actually pay for the process to be a big donor and a supporter.

But in any case, those are the three essential mindsets shareholder steward, part of the team, and governor for management. Now, the skills and backgrounds are part of a collection of attributes that each board has at any given time. They'll call it something different, but most boards call it a matrix of skills, and they will identify the current cohort of directors fill in the blanks of their key skill sets. Let's say, for instance, governance, technology skills, financial expert, things like that will be noted.

And then in the combine of all the parties in the board, you'll see where you may have gaps. More importantly, if you see the upcoming retirement or divestiture certain board members, you can see where your gaps are going to be, which informs the people you will be recruiting in the next round. The most important part about this is you'll not only have the matrix of skills, but you have the timeline to be looking for the cohort you'll have at any given time, and you have the opportunity to decide whether or not there's a certain area of emphasis you want more than you had in the past based on the skill sets, your management needs and the future that you hold for that organization.

And so finally, in the question of why does this matter, is because you're stronger together. This really is an evaluation of a team coming together to support the responsibilities that has as a member of a team. Yeah, you're stronger together, and the CEO needs that strategic support. Right, what does distinguish in effective director though in giving support to that CEO and you were seeing collectively as a group, so the alchemy of the group comes together to really support that CEO.

Are there sometimes a week link in there or how do you shore that up? Yeah? Sure. First of all, the rules have changed a bit in the last few years.

Namely, strategy has always been business strategy. Governance has always been governance in the pure sense of the word, but now more recently social, political, and economic issues are in the forefront of the board's agenda. More specifically, now we're not only looking for what you've done in your life, but how you've done it and who you've done it with. So strategy now becomes much more broad and support a CEO and the management team.

An effective directure needs to be thinking about all of those skill sets and they bring to the table now more than they used to. Likewise, the board as it looks for candidates to be part of the team in the future, it's looking for skill sets that I'm going to call her softer political social skills that perhaps weren't highlighted than the years past. Second piece, to support a CEO and maybe as important is know when to speak, know how to speak, and stay on mission. There's a lot of mission creep that happens in board meetings because it's a team effort.

Sometimes someone goes off, as you mentioned, they'll run rogue, they'll go off into an area of not importance or an area that's not at all germane to the topic. And that's where the chairman or the lead director, which we'll talk about later, come to play. That's where they play conductor. The conductor says too much clarinet, you know, too much percussion.

Let's do it again. And in this case, the combination of the ideas that are brought forward, the way they're shared, and the amount of time it takes is really the oversight of the board share or the lead independent director to make sure we stay on track and then people stay in bounds. I will say, you're often taught a lot by the issues that come up that you didn't expect. So if a board has a different interest than perhaps management expected, it's telling for mansion to realize this is an area of interest that they might have thought about, and therefore the shareholder may have an equally high level of interest that they hadn't thought about.

So there's a lot of value in getting ideas that weren't initially projected. But you need to stay on task, stay on point, and answer the questions that are before you. So there's the phrase head in, hands out, meaning don't step on the toes of management, let them manage the company. You're there to be that advisor strategically going forward, approve the strategic plan and such.

But given all that has occurred over the past even five years and the disruption that's out there, does that line blur it all? Or how do you balance that as a board director to make sure that the risks are being addressed while you're still fostering innovation and long term creation, but you want to make sure that things don't go awry. It's a great question, hew do you balance that? And they can go a right head in, hands out applies more than ever, by the way, because it's more attempting than ever to get into some of these softer topics that are less specific.

So, for instance, if we're dealing with financial topics and the controller is talking about a bond issuance, you have a number of board members that have a lot of skill in that area, they'll speak up or they'll ask questions. It's very Germane. But if the CEO is asking about how to handle the communications after an event like the George Floyd murder, everybody at the table has an opinion. Everyone has an opportunity to share their thoughts, and this becomes a broader, larger topic.

So the need to corral the incidents of people either going too far or having so many people have input that you have too much. That again goes back to the board performance of the chair or the lead independent director. Now, overreaching happens unwittingly. So I've actually never met a director that intended to overreach because they're bad people.

What happens is they're either fairly new as a board member. This might be their first board and they're still learning the line between governance and management. Or in other cases, they can't help themselves because it's in the business they used to run and they can't help. But getting into the details, nobody knows exactly why.

But all that to say is if it's not harmful during the meeting, you can go a little off path and let that person offer their thoughts. But as soon as the meeting's over, the chair or the lead director need to contact that board member and say, look, really appreciate your thoughts, but the way we're trying to manage the board and the time we have together, that was more than we want on a topic we really didn't need to. And you go back and you interrogate not only what happened, but you help them realize where the lines are, because that's where the learning occurs.

You'll find board members who are very experienced are more like the old Ef Hutton commercial which you may remember. And the commercial was it's in a busy place somewhere like Union station, and all of a sudden, the broker is talking to If Hutton is talking to their client, they have an opinion on something, and everybody just stops and wants to hear what they have to say. And that's the highest praise as a board member who speaks less often, but when they speak, everyone's leaning in.

And so part of that overreaching comes and having people speak less and giving more time for others, but allowing for everyone's opinion to come through as long as it's on point, and if not, then, as I said, you'll take care of it. Off topic, the last place to do it, Janice would be in the executive session. Executive session is a place where the CEO has left the room, the meeting has come to a conclusion. The lead director or in this case, if the chairman is not the CEO, we'll ask for feedback about the CEO or something may have happened in the prior day or two.

It is very important at that point too for that person to say, look, I really thought this was a good board meeting. I do want to say, though, I'm a little concerned. We really went down a rabbit hole over here, and I want to caution us not to do that again. Or somebody might say something like, you know, I thought Janice, who might be the head of president of something, I thought Janice looked tired.

I'm worried about Janice. Do you guys think she looked tired? To what lead director will say, I don't think that's really important. I mean, if there is a concern, I'll make a note of it.

I'll ask the CEO if there's any concerns because one of you felt that maybe Janice is looking lackluster. But that's really not what we're here for. And so you just keep people on pace in a diplomatic and thoughtful way, and usually people respond quickly to say I get it. We really don't have unlimited times, so thanks for the feedback.

I have seen it where the chair took Actually it was one of my placements a while ago. Took her aside and said, you know, you're really smart, but there are a lot of smart people in the room, right, so you know you don't And the person adapted. Yes, they just had to be told right. Yes, the intentions are great.

Never seen it otherwise, but I do see. It's tempting, and especially when you know the business, if you go into a business that you used to run, it's hard not to jump in and ask a level of detail on a question, not because you're showing off, because you really want to know. But didn't you realize, guys, that isn't relevant to the question, and nobody in the board has any interest in that answer. So it's well intended, but it's usually easily easily to realize.

So the role of the chair or the lead director, which you have held, that's so important, isn't it in terms of making sure everybody speaks, all things are addressed. Indeed, how have you seen this really? And you mentioned a little bit, how have you seen this really operate well and what else can be done going forward? I think that's a very interesting topic, and particularly as you have two kinds of senior leaders on the board.

You have the CEO who's also the chair, or you have a lead independent director who serves as the chairman. Because the CEO does not have that distinction. In either case, those two roles have no difference of distinction. I want to make this very clear.

Boris will spend lots of time deciding whether the CEO should have the chair position or whether it should be independent. The institutional investors have a view they would prefer the jobs to be separate. But from experience, I can tell you the responsibilities of a lead independent director or that of a chair and CEO are absolutely identical. And someone will will want to challenge me on this, but they are identical, so there is no real distinction between those two monikers.

Therefore, the independent director in the most important period of the meeting, which is the executive session, when the CEO is gone, that's when allow this conversation really matters. This is when the dialogue and the responsibility comes to the fore. Number one, the board will conclude the board meeting with management leaving the room, and the CEO stays and the board and the CEO can then talk about a number of issues that came up in the last day or two, or just anything that's on their mind.

Particularly they might offer thoughts on what they want to cover at the next meeting or things that they wish we had covered before. The CEO's taking notes, everyone's paying close attention, and the CEO then is asked after that conversation to leave, and now we have what we call executive executive session. The best practice here janis is that the minute well intended or otherwise, the minute a board member starts bringing up issues that the CEO should hear, not about the CEO, but another issue about how they felt about Janice or what they think, you know, we're doing in the strategy.

And I've done this before twice. I said hold on a minute, and I've gone to the door and I've followed out the name of the CEO and invited them back in the room, because you really want the executive executive session to be limited to and only about the CEO. So everything's been covered. Now, now let's talk about the CEO.

It could be succession this up and coming. It could be about the performance review that's coming about. Could be somebody who said, hey, I just want to talk about the way the CEO went out after the social impact issue and I did or didn't like it, and I want to know howbody else feels. So it's got to be very unique to an audience without the CEO.

But that is where the real board challenge comes in, because that's where the CEO will get the feedback that's so valuable, and the way it's given to them meeting is over over the lead director then or the chair will exit the room, everybody else goes home. Best practice is that lead director walks down the hall to the CEO's office, who's been patiently waiting to find out what you've been talking about, offers them feedback. And I'll close with this, it's very important that the feedback is anonymized.

I was at a board where I found out late or that everything everybody said was shared directly with the CEO in terms of attribution, and I think that's a harmful outcome because you really want board members to feel comfortable saying what they're saying. The director or the chairman can decide how much of that to share. But for the most part, if I already go in to see the CEO, I'd say, look, these are the three issues we talked about. There was a fourth issue the only one person brought up.

Nobody else jumped on it. But just so you know it came up, you might want to just understand it was confusing to somebody. But then the CEO now is done with the cycle. The meeting happened.

I've heard from my chairman. I know now how we ended the meeting. I got feedback always in the room. I got the rest of the feedback when I wasn't.

I'm ready to run the company again, and I'll see you guys in sixty or ninety days. That's great. And to call the CEO back in if it's a topic or an area she should be really too. You did that, that's great.

What about with shareholders? Should board directors meet with shareholders separately? Do you think the CEO should be there all the time or there are times that they don't need to or shouldn't be there. Great question.

The institutional investors or some of the very large investors, have asked on occasion to speak to a board member based on the topic. So they could ask to speak to the HR and comp Director chairman to talk about compensation. They could talk to governance about some of the issues that are coming up in different proxies. Management always knows.

Management is always there. The CEO is typically not there, not because we don't want them there, but typically other things to do, and so the senior investment relations team will work with the board member to prep for the call, be there to hear the answer jumping and fill in any gaps. But it's very common for a board member to be invited to speak to shareholders in a formal and fully approved, transparent process. The CEO can be there if they'd like.

The most important thing is though you've got your financial disclosure risks, so you can offer nothing at those meetings that isn't public knowledge. You have to be very careful that you don't speak, overspeak on certain issues or answer questions that weren't asked, because it's tempting sometimes to fill in blanks and you might find out later they weren't even asking about that, and you gave all kinds of unnecessary detail that wasn't requested and you missed the point. So yes, shareholder responsibility is high, but none higher than at the time of the proxy as the board hears the concerns that are brought before the shareholders for the annual meeting.

The shareholders are represented there by the dozen or so of you that have been volded in and you're elected every year in a public setting, and at the end of the day, there is mostly guidance given by the shareholder actions. Very rarely does it come to a point where you've missed the mark so much that you have to change the way you lead the company. But there's often advisory information that comes out and some of those proxy responses, even if it's nineteen percent or twenty two percent supported, that says that's somebody who invests in the company wants you to be paying attention to these topics.

And so it's responsible to the whole board to debrief the proxy season and wait for it. Look at the peer group proxies as well to see if there's anything brewing in the community of business that you do that might not have come to you this year, but might be out there very interesting. So is there are many in the audience who will be aspiring board directors and joining a board or in the process of doing that, what would you say boards, not just the industry specific, what are they looking for in that new director, particularly in this day and age of AI and geopolitical uncertainty and all the disruption, the shifting sands that we have going on.

What are boards looking for that you've seen and been talking with your colleagues on other boards? So very contemporary to this question, at least all of the boards I'm on. As we look at our next opportunities to bring in a new board member down the line, we're all focused on soon to retire CEOs or recently retired CEOs, And that, by the way, wasn't present a few years ago. And the reason it's interesting is because we're looking for a job of all trades.

A CEO who's finishing in their term or just finished. It is very rife with the skill set of being able to pivot the nimbleness, the hard facts and the soft issues, and so it's just tempting to find somebody who successfully ran a company to come in and help you and management help run this company from a governance and best guidance perspective. The second thing would be, and if I were bringing in new directors and helping them think about what skill sets matter. I don't think there's a board left in America that doesn't have I called it a matrix earlier.

It could be whatever you call it, but it's this listing of all the board members' names, the dates that they will likely retire, but more importantly, all the attributes and skill sets that they have. And then you have this picture on one page of where there might be gaps, or more importantly, you take away the next two people who are about to leave and you see where the gaps might emerge. Those skill sets, and there's probably twelve to fifteen. I'll bet they're almost the same everywhere, with a different emphasis on different skills.

Those are the skill sets that boards are looking for, and I mentioned them earlier. But they can be very broad. They can be like financial expertise literally in the eyes of the SEC on the yaudit committee. It can be softer, like just good governance experience.

It can be shareholder consumerism working a consumer company where you understand feedback and you understand social media. All that to say, I would say the jack of all trades in the most areas is a high reason to be candidate for a board. The second thing I'll offer you, though, is boards, to the most part, not all, but the boards i'm aware of typically stay away from bringing on an expert of one thing. The temptation a few years ago to bring on a cybersecurity expert super high, the temptation to bring on an ai coinbase something like that expert right now super high.

Some do it. The temptation is usually left unfinished because the decision would be if I bring on an expert in those areas that are hot right now now, Number one, I'm going to rely on them, perhaps more than I should, at every meeting, asking their opinion, only to find out that, for no reason of their own, they're no longer contemporary, and that topic has moved past them, and now we're listening to somebody with old information. And so it's best practice is to, I'm going to say this quote, pay for the expertise, bring in third parties or experts to educate the board and management on these key areas of governance related to special topics, but typically not hire someone with a one skill set, because more than ever, you really need to be nimble enough to do so many different things hard skills and soft skills alike, and so I would say that, and to stay contemporary with the world around you every day, be thirsting for information, try to understand as much as you can about the world.

The hardest thing I brought up there is where do you get your information? That'd be an answer topic for another podcast you should hold. But the fact of the matter is you want people who are contemporary. And I do think that when we meet as a board with a management or the senior leaders of a company.

Every single time we meet with people who don't know us, I think they're profoundly surprised that it's just so basic. We're fairly easy to talk to. There's nothing provocative. We're not actually smart in any necessary way.

We're just very passionate about the company that they work for. And I think they're relieved to find out there's no mystery. And I say to you, people who want to be aspired to be board members are in the same camp where I think they think it might be more mysterious than it is. It's a team of people brought together and approved by shareholders once a year to help leadership govern the strategy and the software issues of the organization while representing millions or billions of dollars of shareholder value.

It's a big responsibility. But when you do it as a team, and you do it with a company that you understand in a world you're staying current, it works pretty well. So how difficult is it to stay current today? And what I had one CEO say to me of a tech company, every CEO and all board members should go away for two weeks to really learn what's happening in AI.

Yeah, that's RT. I think that's right because AI is so deep. And here's the problem AI in boards. You'll get this head fake where a lot of boards think we've been dealing with AI for years.

Maybe right by the way, I mean your GPS is AI. You know, we haven't looked at a Thomas Brothers map in twenty years. And so the head fake is it's not that AI we're talking about. It's also not the high level AI is going to fire everybody at the entry level job because it we'll be completely redundant.

It's a gentive AI. It's this whole new world of what it can be for both economies of scale, for efficiency, for intelligence, and for success. So that person is right, because there could be nothing more disparate in the last ten years than the board members's skill set and knowledge of something like AI. Some people think it's, you know, the next biggest thing since the Industrial Revolution.

It's big either way, and I think they're right to say the risk of board members coming in with a high range of understandings and confusion could create a real issue down the line. And by the way, secondly, the reason that makes sense, I don't know if it's two weeks, but management will be smarter on this topic, probably in their own company than the board will. But to the extent that the board has experienced in other places, OMG, what they can do to offer the sense of where others are using it differently, where others have a different value for where others see it's risk rewar differently.

This might also be one of the most valuable places of board can ever offer, because this is current what are you learning, where are we and how's the curve moving quickly? So that person was smart to say the board needs to be brought to the same level of understanding. That's how wecan't it. I don't know how long it would take, but only because it's a once in a generation issue.

We don't need to do that for other topics. We all bring our best experience and it works fine. I do think AI is that unique, but I also think it I'll close here. I also think that management needs to tell you what AI means in the company before you tell them.

They need to offer up their position of how they think it's going to be useful in our business, in our industry, and you need to react to that, not start teaching management, react to what they're telling you. And that's a different way of coming into the conversation with the whole idea of being a good governor not a manager. It's so true. You know this specialist.

You have to be a multi specialist today, not a specialist. And you need to be able to swim in many lanes. So if you're a cyber person, you still have to be able to talk globally about what's happening geopolitically, and if you can't do that, because the decisions that the board and CEOs are making today have highly consequential. Impacts, absolutely huge, huge.

And is it really so different today than it was even ten years ago. I'd like to say yes, because it sounds interesting but no, it's not. It's just an emphasis on a different issue. The biggest thing that's come along is the last few years when the DEI topic started to move around from its original strong hard position, and at the same time the social responsibilities of the CEO started to come into play, where people thought, my CEO should be having a voice and an opinion on this topic.

And you say to yourself, really, I mean, is it Germaine to your business? They should have opinions, but is it related to does it matter for you as an employee what they think on that topic? And that is where the boards are now much more important than they might have been. Janis.

Ten years ago, we were dealing with black and white on every topic. Was very clear stuff. It was very technical, it was very financial, it was very measurable. We've now gotten into the areas now much more difficult to explain, much more difficult, and CEOs have been I believe, much more appropriately vulnerable.

And they'll come into a meeting today that they went ten years ago and say, I need your help. This just happened. I know there's different responses. I need your help.

What do you guys think? What would you recommend or here's what I'm thinking to tell me what you think that didn't happen ten years ago because the CEO knew their business in and out, and now the CEO knows their business, but how it fits into the world that keeps changing. That's what we come to bear and that's why the CEO needs a board that's got nimbleness and respect and capacity for being able to change quickly when things change around them. And that's why it comes down to that discussion in the boardroom.

Doesn't it to be robust to everybody being able to contribute to the lead director, but I would think also other directors in terms of making sure that others also contribute. What are those traits around the boardroom table that you see that are so important for that robust discussion, which will then impact the decisions that are made. Well, you have great questions because this one just triggered an idea. The best boards will agree that in the last few years, we've asked management to stop draining the slides, which is to read every slide.

To us, that was a practice that was forever and they would send you the pre read and then the slides would be also included in your pre read, and then they would read the sides and everyone's satisfied with that, and we could ask questions that we're done. The new contemporary boards now literally ask management to trust that we've read the slides and the preread, which is much more thorough than it used to be. And maybe you set us up with a question, and let's figure out what else we don't understand from what you said.

Let us start bombarding with questions that are informed of either because you can say we've already thought of it and you'll be relieved to know we've done that, or wow, I hadn't thought about that, and based on what you're telling me, another group is doing, we probably need to look at that. So number one is not draining the slides. Therefore, now the board time in the boardroom is management speaking less and board speaking more, big difference. So already in that approach there's a lot more board conversation and a lot more voice of the board.

Secondly, the board really has to practice the time management and use of the microphone. They can say, hey, janis you just mentioned blah blah blah. My experience says just the opposite. Tell us a little bit, how do we know whether the customer believes what you're saying or I'm saying.

You answer the question, and then I don't ask a follow up. I don't keep asking five questions and forget that I'm in a room with other people. I pass and I let someone else have a question. What's really neat is when management starts to jump in and answer questions that we're asked by the board, and more than one person answers it, so the person directed answers it.

But then Jennis will say, you know what, Richard, you might have a view on this, me being your colleague, and all of a sudden, now management's talking more. And so I think it all sets up with a more contemporary view that we've read our work. We're smart enough people, we all care very greatly about the company, and we're all trying to get together for a couple of days to figure out how we can be better together and come up with better solutions because we all worked on this together.

That's really the bottom line goal. And I think it's gotten better. I think we're smarter than we used to be. The next question to ask in the nuance of high performing boards is most boards have a tenure that a seventy two years old, are seventy five, and very few, very small percentage under ten percent, I think, have a term limit and it's usually fifteen years.

So you can in today's world have a seventy four year old board member who's served for thirteen years, and there's everything right about that, because that's what the rules have been here tofore. The question will be, in this world of changing quickly, are those the right measurements for tenure and for composition of the board. I'm not here to answer it because I think it's it's a question to be asked and evaluated over time, because there's a lot to be said about experience, there's a lot to be said about new ideas, and they both have their place, and I think as the world continues to move that is going to be a question facing most boards.

So again, it gets down to that composition. And you can have some people who in their seventies and you know, and maybe been on a board for ten years and can continue. But you needs to have some balance, do you not? With somepath?

Right? We talk about board refreshment. Right, I mean, you talk about it. I was just I'll confess I was just struggling to get on this webcast because I don't understand how to use all the technology.

And I'm sixty seven. I'm not stupid. I just have never done it. It's not intuitive.

My guess is if I had been fifty and the board member you want to talk to, I'm just guessing I would have figured it out on my own. So as simple as things that. But if you want to go back and remember the other recession of nineteen eighty one, I got you covered. And my year old colleague, you know I'm trying to do the mouth probably wasn't born or just was a kid.

Well that's where you get the variance of outcomes. But boy, I'll tell you what it's like an orchestra. I need all the instruments to make the sound really, really beautiful, and so I need to have that verity, variety and that skill that comes from age and experience. Well, wisdom, I always say does prevail, but sometimes on technology we can fail.

I do the same thing. So is for new aspiring board directors, somebody's coming on new to a board, what are some of the mistakes you have seen? Your advice to avoiding those for new directors because you don't want to just sit in a board and wait for the third meeting. You know, right, Okay, listen, that's a great question.

First is poor time management where they just don't know how long to speak, or they just don't know how to pay attention. So they say, I've got this idea, here's their opinion, they talk about it, somebody follows up on it, and that's a perfect place to go back and round it out. They'll come up with their next question and they're not like, they're not like listening, they're not paying attention. They're there to say what they needed to say.

So number one, it's kind of a poorer time management and poor listening skills. The second would be homogeneative thought. We are only best when we are not aligned exactly, because it's the nuances on the margin that will be the most interesting thing. So when a board has a different view of different things, it's really the chairman of the board lead director to ferret out those differences and to celebrate them, not to be afraid of them, and not to seek home geneti genetity, but find a difference of opinion, all the while making sure it's productive to management.

It's not intended to be confusing and allow management to take that unnoticed and decide on their own if it has value. I'll give you a great example. A new board member the other day turned out called a senior manager twice in one week. And I was talking to senior manager for a whole other purpose.

And they said, boy, so and so sure does reach out a lot. And I said, how's that? And they told me the last week and that they asked them to do something and they were actually giving them homework. And I was happy to know that.

And I then call that board member and sayd I understand you've been talking to so and so, love your interest, love that, but I ask you do me favor. We need them to work hard between the ninety days that we're not there. I don't want you to give them assignments. And if there's something really important enough for you to hear, share it with me so I can decide to bring it to the next board meeting.

Lack of understanding both the role that we have and to not need to prove to manage, you know more. Just allow management to know what they know and offer your feedback at the right moments. And so when we all have the same views. It's dangerous.

It's not bad if it's clear, but listen to the descending views. It's political, it's diplomatic, and the lead person in the room needs to say, let's make sure we hear that and at least develop that a little bit further. And then finally, the biggest one is again the choreography in the boardroom. The newest board members do not have less voice.

They are not supposed to sit in silence for the first three meetings. They walk in the room with credentials that we apparently picked in the first place. They have probably got the newest sense of things, and in fact, if they come after a presentation say look, I'm sorry, but I'm confused, why are we even working on this, and someone say, oh, well, we kind of lost track of how we started. Let's go back and share it.

Or you know, you bring up a good point. I think we might have sat on this too long. It's very telling. So it's important to not silence or demure the new directors, but to bring them in instantly and right away, and a good chairman, we'll call them after the first and second meeting and say how are you feeling.

Here's my view of your contributions. I may want to set you up with a mentor on the board so that you Janis can work with Richard, who's been here a little bit longer. You guys can work together and if nothing else, sit next to each other. So if there's acronyms that come up, you know, they can just whistle with them in your ear and we can continue forward seamlessly.

But that would be My issue is making sure that you know your voice. Listen to the room, speak up when you have a voice, and be taught, be willing to come in in and learn and respond to people who give your feedback because you're going to be there quite a while and you want to get it right from the beginning. You know, Richard, I've watched you. You know, I did so many great assignments for you when you were at US Bank, And what always stood out to me as a leader at US Bank and placements that I made, would say this too.

You led with such great character, You led with such great courage, You led with such great commitment, and you were so collaborative in terms of leading the organization. And I hear this now, you know, just being on board, so you really want them to be the best they can be and the most modern board, but not forgetting their people right and to really have the highest integrity in everything we do. Do you think we're going to hold to some of that going forward and will that be even more of a prerequisite for all board members?

Yes, I think so. First of all, thank you for that. I would say the as I've used the word a couple of times. The softer issues social, economic, political, those are in the space already where culture and beliefs and respect and decorum, that's where those all come through.

So I think more than ever, we are transitioning to a full bodied, more robust set of people coming together as a board of directors to work as a team, to help another team, to represent the people that invest in the company. I think it's more more now than ever, and I just can't ate enough. If it's the last thing I say. We are the shareholder's voice.

You know, we don't come just to respect respond to ourselves. That the shareholders look like they're interested in some new emerging issue. We must at least respond to that and decide we disagree or decide it does have merit. And that is the best hope that someone has as having made an investment in the company that hopefully in the next year or so the investment will be stronger.

But to believe that there are a group of people to gather, you know, five or six times a year with the intent to hear what will do best for the shareholders while doing it the right way. And what's nice, jenis to close that out is doing it the right way is always the right answer because it's sustainable, it's repeatable, and it's easy for people to work for people who are doing it the right way. And there is no nothing Trump's that more culture, Trump's strategy all day long.

And I think that's the case here. That is a great message to leave our audience with and say, Richard K. Davis, thank you again for being a true disruptor for good as a see and a board director and a philanthropist. And thank you for sharing insights that are going to be so valuable to our listeners on the evolving dynamics of board composition.

Your perspective, shaped by more than four decades at the highest levels of the banking industry, not an easy industry to manage, has added tremendous depth to this conversation. It's been a real privilege to learn from your experience and wisdom to serve you as a CEO for placing candidates there, and I know our listeners will take away in valuable perspectives from this discussion on how to be the modern board director in an area and a time of governance at the speed of change.

Thank you, Richard K. Davis Well, Janis R. Elk. Thank you as well for the invitation.

It's an honor always to be asked and to have somebody ask your opinion. There's no higher praise. Thank you for the Leadership Reimagine series. I'm glad to be a part of it now twice and I will look forward to all those that follow.

So thanks for your leadership. Well, and now I'm going to get you to win my Board Academy boot camps for Richard sir, let's do that for me. Yeah, And to our audience, thank you for tuning in to another game changing conversation on Leadership Reimagined. You can find me on LinkedIn, Instagram or visit our website at ellagroup dot com.

Thank you for joining us today.