We don’t properly understand the impact of boards in our business landscape today. Whilst recent research confidently states that the composition and role of boards is slowly changing, I think more needs to happen; we have a long way to go for Middle Eastern boards to reach their full potential.

Whilst there are some sophisticated boards that are well conceived and have the right mix of industry skills and functional expertise, great governance, diversity and culture, and experienced directors successfully navigating their organisations, this is unfortunately not the case with the average board. One concern is that directors are selected not for what they can bring to the table, but for their family and cultural ties. Understandably, trust is a big issue in this game. Hence, directors may favour supporting their own, or people who are agreeable and likely to see the world the way they do. However, this is counterintuitive and defeats some of the core tenets of boards. Independence and diversity (of all kinds) broaden our perspective to help us navigate through the slew of challenges and opportunities that organisations face. Additional data from myriad sources, and critical thinking, promote better decision-making, and this can only be a good thing. We need to remove barriers for directors who are from different backgrounds to join boards in the region; and yes, that includes people of different culture and age, and women.

However, we still need to be careful and considered when aligning new directors to organisations. There are core behavioural attributes and competencies required to be effective. Successful board directors are culturally savvy, they understand the nuances and the psychology of how people in the Middle East think and operate. They don’t just assume they know. This very aspect is crucial for gaining traction with people in general. It goes without saying that new directors shouldn’t have any other agenda, except to positively contribute to the development and growth of the organisation, and to achieve its overall mission.

Successful board members know how to listen and synthesise information before expressing opinions openly, but very tactfully. They display their deep and practical understanding and respect of the cultural nuances, particularly if they are a non-national, and have the patience and tenacity to endure longer decision cycles.

An efficient board must have its finger on the pulse of today’s business landscape, the industry, and life in general. We generally expect that boards are comprised of retired professionals, and I certainly agree with the value of their decades of experience, but I also feel that working professionals have a first-hand view of the current business landscape. It is invaluable for boards to better understand today’s customers, employees and other key stakeholders, as it results in more considered, relevant and useful decisions.

Adam Malouf is the Chair of The Middle East Advisory Committee of the Australian Institute of Company Directors, and a senior executive who has lived and worked in the Middle East for 17 years. He is a seasoned non-executive director and sits on boards in a wide range of industries. Adam believes that there should not be a one-size-fits-all approach when it comes to shaping and refining effective boards. “As the guiding hand of the organisation, the board needs to be structured carefully to not only meet functional needs, but also in the context of where the organisation is at in terms of the business life cycle, and also considering its key stakeholders”, says Malouf. “You need to get the governance right from the outset, such that there is a practical and meaningful impact in terms of performance – abstract and esoteric concepts do not work in this regard and can actually result in erosion of value over time”.

From a functional perspective, whilst accounting, finance and legal experience tends to understandably remain the general preferred background of board directors, I feel that inclusion of directors with design, technology, and marketing experience would broaden the representation of the business, and, with that, a broader consideration when making practical decisions.

The more that we discuss issues impacting the effectiveness of boards are openly discussed, the more can change, and organisations can succeed at a greater rate. We need to see that adding new board directors as an opportunity to strengthen our understanding of the world around us, and an opportunity to make better decisions that positively transform the lives of our employees and customers. If directors consider themselves in a genuine position for the longer term, and boards develop in a style more aligned to that addressed in this article, we will start to see an exciting industry mature; one that is more diverse, agile, and committed than ever before.

‍

‍About the Author

Hakan Alac is the Founder and Managing Partner of Alac Partners. Hakan works closely with business owners, boards, and C-Suite leadership to unearth and build highly effective boards, directors and executive leadership capable of radically transforming their organisations and directing them to sustainable growth. He is also an executive coach to many senior leaders in the Middle East.