Q&A with Charlotte Valeur on boardroom diversity and best practice in corporate governance

This Q&A with Charlotte Valeur, founder and CEO of Global Governance Group, first appeared in Ogier's "Any Other Business" briefing for Channel Island NEDs.

Tell me a bit about your background and how you came to be an NED for the likes of Blackstone, NTR and Kennedy Wilson

I began my career as an investment banker in Denmark in 1982, and then moved to London in 1990 and working in dealing rooms throughout the 1990s, before coming to Jersey 11 years ago. As soon as I came to Jersey, people began inviting me to sit on boards of various investment companies, and it was a natural fit given my skills and background, particularly in areas such as hedging and derivatives.

When I started going into boardrooms I found the whole governance set-up extremely interesting, and that became a strong focus of my work as a director. It does not take significant time, effort or investment to achieve better corporate governance, and the returns can be substantial, and are becoming more substantial every year because of changes in regulation. The push for boards to do better governance and better standards of practice are increasing all of the time, and there really is no place to hide. That's why I have spent 11 years focusing on corporate governance.

What do you find most rewarding about being a NED?

It is just amazing – the kind of people that you meet, there is a huge variety of people from all backgrounds, with all kinds of interests and skills, and you find that you are learning from them, all of the time. I do not think that there is a single board appointment from which I have not learned something, and that is the on-going intellectual challenge. I never serve on the boards of two companies that are in the same field, partly because I enjoy a wide variety of work but mainly to avoid conflicts of interest. It is of course possible to wrap around a process to manage the kinds of potential conflicts of interest that could create, but I prefer to avoid them completely. The other advantage is that you end up with a diverse experience, so in my case, I currently sit on the boards of the University of Westminster, as well as companies in Private Equity, property and renewable energy.

What do you think are the greatest challenges for companies seeking to implement corporate governance best practice?

It does seem as if, often, the board members do not really want to spend time on it – even though none of it is rocket science. It might be heavy, the meetings might be a little longer, but these people are there to run companies, not to take the sandwiches and run!  Is it wilful neglect? That's maybe a strong way of phrasing it, but there is no good business rationale why anyone shouldn't do this. Effective corporate governance is not hard work, it is not difficult, people just need to get on and do it. It may take some education and training but these people are all intelligent – it's reading corporate governance codes and spending time thinking about how to implement them in practice.

Your work has taken you all over the world.  In which countries do boards tend to be particularly committed to increasing good governance?

I was recently in Rwanda with a group of 30 politicians from all over Africa – they were incredibly engaged and interested on corporate governance decisions, considering, for example, whether CEO and chairman roles could be shared on boards of state-owned enterprises. There was a real interest and engagement in wanting to have the right standards and to do the right thing. And there is a question for westerners there – we went into Africa for years and years and messed about and did what we did with no real thought about whether it was beneficial for the country or the wider region, or whether it was sustainable. So I think that we have a duty, and I would like to see more people from the west go there more to talk about and share experiences in corporate governance, and also to stop greedy people coming in from outside and to continue what was effectively going on before. I found it enormously encouraging that the politicians that I was speaking to were so receptive on the subject of corporate governance.

It has been four years now since you set up Board Apprentice to encourage diversity on boards – how does that work?

For me, diversity is not just about gender and youth, there is a whole range of different diversities that we need in our boardrooms. I imagine it as a body – you need to have all eyes to see with, perceiving all relevant viewpoints across different perspectives. Sometimes boardrooms can have too similar an outlook, background and training – the meetings might be faster, but there is not as much depth, because no-one is asking the right questions. That is true diversity – diversity of thought. But to get that, you need to look at the people in the boardroom. In all countries we are still seeing men of a certain age taking up 75%+ of board positions. In my view, you need a 50/50 gender split – that goes without saying, but beyond that companies should be looking at the diversity of their customers and suppliers and look to have that reflected and represented – if the company does a significant amount of business with China for example, then it should consider some Chinese representation on its board. Technology skills are something that all boards want, but they don't know who to get or how to get it. Millennials bring those technology skills as digital natives, bringing that kind of thinking to the table. With the best will in the world, that is difficult for the rest of us, but insight into digital technology is something that all companies need.

But we should also be thinking about neuro diversity, by which I mean considering the perspectives of people on the autism spectrum or who are dyslexic or who experience dyspraxia, people who think with 'different wiring'. They will quite naturally think and focus differently and that can bring something to a boardroom. My son is autistic and it brought me into that world, meeting different people with 'different wiring'. Society tends to ignore that because it's different. But differences are what you want on a board – if you start from the position of 'you have to look like me and think like me' a boardroom will never perform its role effectively. We are not on boards to make friends. I do not go into boardrooms to find friends – I am there to lead a company. It doesn't matter to me if I like a board colleague, what matters is how they are thinking. It can be difficult not to be self-serving, because we all naturally have a survival instinct, but as a board member you hold yourself up as a leader and that means holding yourself to a higher level.

It has been four years now since you set up Board Apprentice to encourage diversity on boards – how does that work?

When I started as a board member it was quite obvious that there was no diversity, I was constantly the only woman there. Something needed to be done. I was looking for ways to open the doors of the boardroom to all kinds of people, but specifically those different to those currently there. So, I built the apprenticeship scheme, to invite someone into the boardroom, to observe the board at work. Inviting people to observe boards is incredibly powerful, and an incredibly helpful way of getting into that space. It is also a very powerful way to learn that it's not rocket science. Some people would like to pretend that it is, but it's really broadly common sense. It is less about knowing everything, but asking the right questions and sticking with those questions until you get an answer that you understand.

We needed to find a way of working that was scalable, because the whole world has the same problem. The same problem exists in Africa, for example, and in north Australia they are trying to find ways to get indigenous people on to boards. Everyone has the same issue, so we need to find a way that we can all work together and solve this. The Board Apprentice concept is one such way.

How do you match a Board with an Apprentice, and what makes a really successful match?

The boards choose the apprentices that they think will work for them, the final choice rests with the boards. They need to be comfortable with someone if they are going to invite them to observe board meetings for a year. We have a pre-selection process that is the same across the eight different countries in which we operate, the list of questions is the same – and they focus on establishing skills and knowledge in the areas of accounts, corporate governance and strategic thinking. We are of course also focused on the diversity a candidate brings and we have voluntary self-declarations about hidden diversities such as neurodiversity and LGBT for example, but if people know enough to hold themselves up at board level, then they are in. We do not worry about anything else. We look at them on their own merits. But fundamentally, we want to avoid more of what we already have.

I think potential and current board members also need both to want to lead and to serve – I think that the idea of service is very important. You serve not just a company, but also a country and a government, and if you want to be a leader today you have to have that ethos.

I also believe that leadership style has to shift. What we have had for thousands of years is a male-dominated leadership style, and that has to change. We need to listen to people with different views and take them seriously, and not just bring those ideas and perspectives to the table but also engage with them.

What is next for you?

It seems to change in strange ways all of the time. I enjoy developing more governance training and I have launched an e-learning platform for that. If you just keep hacking at it, you will get to it in the end. At the moment I am looking more at governance within governments. It's not that different from boards – a group of ministers is essentially the same as a board, and collectively they function as board members. It is going to be really difficult to get diversity happening in commercial organisations and the third sector if governments are not leading the way through being diverse themselves.

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