Public Boards of Directors are not exempt from the sweeping business changes necessitated by the COVID pandemic. In the Silicon Valley, we are seeing tools such as working from home, streamlining management teams, company downsizing and even M&A being used to deal with a very different economy. But even in the boardroom there are changes being made, with a number of boards installing new Chairman in response to market/industry changes. Board Chairs I have spoken to expect a challenging market for the long-term. And all Chairmen, old and new, are looking at the quality of board membership with new urgency.
Our analysis of the Lonergan SV150 (the largest public tech companies in the Silicon Valley) over the past five years showed that boards grew in size by 20% from an average of 7 directors per board to a 2019 average close to 9 directors. Anecdotally, I have heard from the new Chairmen they are working to reduce the size of their boards while swapping in one or two statured executives with extensive operating experience. They seek a lean team of hard-working colleagues who can help their companies through an unprecedented phase of change. Boards will be expected to work more closely with senior management, offering actionable guidance and real-time support for the company.
It's time to ask yourself if you are getting what these times call for from your board. If not, maybe a change in the overall board skillset would help.