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What the board needs from the CHRO

Hear it from a CFO and board member: "A great CHRO is just as critical a member of the senior leadership team as is the CFO or the general counsel."

4 min read


What the board needs from the CHRO

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What should you put in your next presentation to the board of directors? We asked retired Fortune 500 CFO and experienced public company board member Wina Woodbury to give her perspective on the insights and involvement she and her colleagues like to see from the chief HR officer.

SmartBrief: How does having deeper insights into talent management and personnel issues help board members govern more effectively?

Woodbury: The most important roles of the board are selection of the CEO and approval of the strategic plan. In order for the CEO to effectively execute the plan, there must be a team of highly qualified and motivated executive leaders in place with strong teams working effectively together toward shared strategic goals.

While companies often stumble due to flawed plans or unforeseen market developments, a very common reason for failure is lack of adequate and appropriate staffing and training of those involved. A key question board members should ask of the CHRO is, “Do we have the right people in place, and are they adequately equipped to make this strategy a reality?” This should open the door to a full discussion of HR risks inherent in strategic plans.

A great CHRO is just as critical a member of the senior leadership team as is the CFO or the general counsel. The CHRO’s early involvement in strategic decisions — acquisitions, divestitures, development of new businesses, etc. — should result in identification and effective, timely execution of the HR-related elements of the strategy.

What are the two most common HR-related issues board members deal with?

Woodbury: Holding onto excellent talent and effective management succession planning. A robust management-development process is critical to the success of a company. The board needs a clear understanding of who are the high-potential, future leaders within the organization and what their executive development needs are — whether that means lateral movement for broadening, specific training in some area, etc. Such a process includes at least annual management succession-planning discussions with the board. Too often, those become “fill in the boxes” exercises rather than honest, pragmatic discussions of who could move into a key role tomorrow as well as where there are gaps in the succession plan.

Additionally, the CHRO, more than most other members of senior leadership, should have insights into the “climate” of the organization: How are associates feeling? What issues are brewing under the surface that can be addressed and mitigated early? Often the board learns of issues only after a big problem emerges. For this reason, the CHRO should attend at least a portion of every board meeting to report on the “state of things.”

What advice do you have for CHROs to increase their involvement and influence with the board?

Woodbury: Great CHROs keep current on developments in their area by networking and continuing education. Being up to date on trends in executive compensation, new skills training, and what associates and candidates look for from their employers will make the CHRO most effective in their position and most valuable to the board.

In planning your presentations to the board, be concise and focus your comments on the most critical matters relating to the company’s operating results, reputation, growth potential, etc. Show that you understand board priorities, and don’t avoid awkward or controversial topics. The board has limited time together, and they want and need to get to the hard issues in order to address them. Of course, you should include important positive updates as well. A CHRO who offers valuable insights will be welcome in the boardroom.


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