Governance
Vetting for Succession
By Shari Mycek
Vet, Vetted, Vetting: to make a careful and critical examination of someone or something, e.g., a person prior to employment.
Few U.S. presidential cabinet members have gone on record about their pre-nomination “vetting” experience. But those who have, according to a 2000 ABC News report filed by Claire Moore, described it as “invasive, humiliating and unpleasant.”
After filling out endless forms revealing intimate details about their personal and financial lives, candidates are investigated by FBI and IRS agents—and then reinvestigated via chats with former employers, classmates, neighbors, and even ex-spouses to verify their information. Some potential cabinet members have reportedly spent between $10,000 and $60,000 on attorneys and accountants just to make sure they have filled out the forms correctly.
While health care trustee vetting is nowhere near as complicated or invasive—“I don’t ever recall conducting criminal background checks,” says longtime trustee Bill Brown, who’s chaired board nominating committees for the Health Trustees of New York State and the University of Rochester Medical Center boards—governance experts agree the process is important.
“Trustee recruitment should be every bit as important as CEO and CFO recruitment,” says governance consultant Larry Walker, of Lake Oswego, Ore. “But all too often, trustee recruitment goes like this: ‘Oh no, we’re going to have a board vacancy in a month or two. We need a new board member. Who can we get? Do you know somebody who knows somebody we should talk to?’”
Rather than experiencing last-minute panic to fill board seats, Walker instead advocates a pragmatic and proactive approach: trustee succession planning. Two to three years ahead of time, board members should identify who’s leaving the board and what’s leaving with them in terms of board knowledge and memory, forecasting what new sets of skills and talents may be needed in the years to come. And what they may discover is that the new skills they will need are quite different from the skills they will be losing.
“Historically, boards have replicated the same skills and background—a banker leaves the board, so [another] banker is appointed,” says Walker. “With trustee succession planning, boards strategically identify governance gaps and actively recruit the right candidates. These gaps will be different for every board; for example, while one board may need increased diversity, another may seek greater financial expertise or an improved balance between visionary ‘big picture’ thinkers and more practical, ‘here and now’ thinkers.”
Many of the same tactics and processes used in CEO searches can be used in trustee recruitment, according to Walker, starting with a “trustee candidate profile”—a brief one-pager summarizing the mission and background of the hospital, followed with a description of the trustee’s major responsibilities, and the personal skills, assets and success factors required in a prospective board member.
A year or so before new trustees are needed, Walker advocates “casting the net wide”—and sending the profile, along with an announcement that “Anywhere Hospital will be filling three trustee slots over the next 24 months and here’s what we’re looking for,” far out into the community. Dozens of names—not necessarily familiar ones—are likely to surface.
From this large and diverse candidate pool, references are checked and candidates’ skills and talents are assessed. Those left standing receive a letter (and a hospital information packet) gently courting them, asking them to engage in conversation.
Walker explains, “To begin these talks so early—a year or more in advance—sends the positive message that you’re strategically planning the future of your board, while also giving possibly interested, but overcommitted, candidates time to clear their decks to take on the role.” Ultimately, he says, the conversation should assess:
• A candidate’s understanding of the governance role—e.g., “Based on your experience, what are the characteristics of a highly effective board member?”
• Their relevant experience—e.g., “What other governing boards have you served on and what have you found to be most meaningful in your work?”
• Their personalities—e.g., “How would you describe your governing style?”
• Potential contribution—e.g., “What are the leadership strengths and assets you possess that have made you successful in your career?”
• Conflict of interest—e.g., “Can you think of any business or personal situations that would conflict with your role as a trustee on our board?”
• Commitment—e.g., “Do you have concerns about the time commitment?” Brown admits losing several potential board members—one a highly visible national professional—as a result of being candidly up front about the time commitment necessary.
“Candidates must be passionate,” Brown says. “Their reputation has to be clean. They have to have ‘smarts’ and the right set of skills. But they also have to make time. If they don’t show up—no matter who they are or what they may potentially bring to the table—they’re no good to you.”
Although there are no guarantees ensuring that new recruits will shine, a “proper” succession plan, professionally executed and composed in advance of when you need it, raises the odds.
“Every hospital—from the smallest to the largest health care system—can carry this out,” says Walker. “Only a few steps are needed.” Thirteen to be exact. Begin implementing Walker’s trustee succession plan by:
1. Appointing a board development committee to design and oversee the recruitment process; define the purpose, participants and objectives.
2. Securing board agreement on the recruitment plan and process.
3. Developing background material on the hospital and board of trustees, such as bylaws, member biographies, information about the hospital, its market and its challenges, information on trustee and officer liability insurance, conflict of interest statements, the board self-assessment process, orientation process, etc.
4. Developing a candidate profile, a board and trustee job description, and a letter to be sent to prospective trustees indicating the hospital’s interest in discussing potential board opportunities.
5. Developing specific questions to ask candidates to determine their motivation and willingness to serve, their ability to devote the time required, their knowledge of issues, potential conflicts of interest, etc.
6. Securing the board’s approval of the development committee’s recruitment process, recruitment materials and projected time frame for initiating and conducting the trustee recruitment.
7. Identifying the potential field of candidates and making preliminary contact (letters and/or telephone calls) to assess candidate interest and willingness to serve, if chosen.
8. Reviewing the trustee candidate pool and deciding which candidates to interview.
9. Conducting interviews, and preparing a brief written summary of each candidate (occupation, length of residency, community involvement, summary of answers to questions, etc.).
10. Determining the best-qualified and best-suited candidates.
11. Making recommendations to the full board.
12. Contacting candidates and offering them the opportunity to serve on the board.
13. Sending follow-up letters to candidates not selected at this stage, thanking them for their interest and assessing their interest in filling future vacancies, if appropriate. Such letters might also suggest other ways for candidates to be involved, such as serving on the foundation board, on task forces, etc.
Not all candidates in the now larger, more diverse (and admittedly, less familiar) trustee candidate pool may have the “instant makings” of a trustee, Walker says. “If you’re not sure, or would love to know more,” he advises that the board “invite them on to the board via a task force or special committee for a trial run and observe their interest and level of participation: Do they speak up? Show up? Are they energized? Do they encourage the best from their colleagues? Do they have good ideas? It’s a perfect way to see, before making a long-term commitment, what kind of trustees they may potentially make—before saying ‘I do’ at the altar.”
Shari Mycek is a writer based in Belle Mead, N.J.
This article 1st appeared in the December 2099 issue of Trustee Magazine.
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