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Despite talk of digital executives joining boards, there hasn’t yet been a flood of technology experts added to the boards of the 100 largest U.S. public companies, according to executive search firm Korn/Ferry International Inc.’s (NYSE: KFY) Korn/Ferry Market Cap 100, an annual study of the boards of the largest U.S. companies by market capitalization. The report found 24 KFMC100 companies have no digital director.
The report’s key findings regarding digital expertise include the following:
- Of the 1,181 board seats on the 100 boards, there are 211 digital directors. More than half have been or are currently CEOs; most are male (88 percent); and they are slightly younger than their non-tech counterparts (61 versus 63).
- Currently, they are concentrated in a few sectors: on the boards of technology, services and consumer goods companies.
- Directors with technology backgrounds are being added to these boards at about the same rate as those from marketing and at less than half the rate of those with finance or audit, COO, or public policy experience.
The report’s recommended practices for recruiting a digital director include:
- Beware of appointing a specialist, or worse, of taking on a “token director,” who may find it difficult to contribute fully as a board team member. Also, beyond the specific digital experience sought, pay attention to the crucial soft skills and attributes that determine fit with the rest of the board.
- Gain agreement on what a specific board needs. Is an element of the business strategy to ramp up online sales or to protect the company from cyber threats? The answers to these and other questions will help determine critical selection criteria.
- Don’t neglect onboarding. Especially with a first-time director or where there is a significant age or experience gap with the rest of the board, a thoughtful integration process — which may include a formal onboarding program and mentoring from an experienced director — will enable the new director to more quickly add value to the board.
The report was issued by three vice chairmen of Korn/Ferry International and leaders of the firm’s board and services practice: Dennis Carey, Robert Hallagan, and Stephen Mader.