Boardroom All-Stars

When Rupert Murdoch handpicked 27-year old Natalie Bancroft for a seat on the News Corp. board following its acquisition of Dow Jones, few were singing the praises of the budding opera diva.

On paper, what seemed to be the Dow Jones heiress’ only qualification for board service was her last name. (As part of the deal, Murdoch had agreed to hold one board seat for a Bancroft family representative.) The professionally trained singer has no business degree and no previous corporate or boardroom experience.

When asked about the corporate-governance experts who said Bancroft’s inexperience could be “viewed as a disservice to News Corp. shareholders,” Murdoch replied: “That’s rubbish! If you listen to corporate-governance issues, just remember what they said when Google floated [its IPO]. They said it was the worst corporate- governance model they had ever seen.”

One observer wrote that the choice of Bancroft was “brilliant” reasoning that “Murdoch’s strategy for News Corp. hinges on appealing to her generation. It’s not often you get to appoint someone that age to a board. I think it’s a stroke of genius, really. Insight into younger generations is insanely hard to get, particularly at the board level.”

How Bancroft performs in her debut role as a corporate director, of course, remains to be seen. The circumstances around her appointment are more anomaly than norm, not because of her gender (although she is the first woman to serve on the News Corp. board) but for her sheer lack of bona fides. And yet her appointment emphasizes an important aspect of assembling a great board: there are no formulas. Top recruiters say that one size does not fit all and an individual who would be a perfect match for one board might be a disaster on another. Such situational realities and the fact that boards act in concert, make it difficult, say recruiters, to single out great board members from the corporate echelon.

Still, board advisers and search executives agree there are universal qualities that apply to the vast majority of today’s high-performance directors, such as courage, conviction, commitment, and intellect. “The qualities of good board members don’t change with the environment,” says Harvard Business School Professor Jay Lorsch. “They need good judgment. They need to participate and say what’s on their mind, and they need to contribute until a decision is made on what needs to be done. It’s almost that simple.”

The responsibilities of board members have evolved, however, giving rise to a new set of standards by which their ability to serve is gauged. “Board responsibility has shifted from advisory to monitoring, and not just because of Sarbanes- Oxley,” notes Richard Ziegler, a partner in the law firm Jenner & Block. “It’s a really tough act to be an adviser and a watch dog at the same time. It’s a challenging role for anyone.”

Such demands mean that board members need to have the time, willingness, and flexibility to deal with complex issues. Yet there exists a tendency to seek “rock star” caliber board members, those like former vice president Al Gore or Avon chairman and CEO Andrea Jung, whose impeccable credentials and high profiles impress current and would-be shareholders. The opinion is that almost any board would benefit from the depth and breadth of their experience. However, all board members and candidates must be selective about where they invest their time, and the ability to align that experience with the needs of companies is both the science and art of executive placement.

Some of the best directors toil in relative obscurity, oftentimes at lower-profile companies. “The best board members are not rock stars,” says Egon Zehnder’s George Davis. “They can’t be. An inordinate amount of time needs to be devoted to board service. Most of the very best directors do the selfless work that shareholders truly appreciate. They are committed to the company and to the shareholder. They typically are not household names.”

Lead and Be Led

In the aftermath of the corporate scandals earlier in the decade, integrity, independence, and courage are essential. “A level of courage is required of every board director,” says Ted Dysart, managing partner of Heidrick & Struggles. “Directors need to stand up to management to make sure management is doing the right thing, but they must also stand up for management for doing the right thing when the results might not necessarily be there.”