Directors need to mentor future leaders to prepare for top management positions, including more women, say leading award winners
The National Association of Corporate Directors honored five high-achieving board members at its 2014 Directorship 100 awards gala held on December 3 in New York.
This year’s honorees include Paula Rosput Reynolds, who received the NACD B Kenneth West Lifetime Achievement Award, and Rhys Best, who was named Director of the Year. NACD also inducted Barbara Hackman Franklin, Ilene Lang and Myron Steele into its Directorship 100 Hall of Fame.
Joseph Alvarado, CEO, president and chairman of Commercial Metals Company, presented the award for Director of the Year to Best, who is chairman of privately held Austin Industries and a member of the boards of Cabot Oil and Gas, Commercial Metals and other companies.
In accepting the award, Best thanked all the members of the NACD’s North Texas chapter who nominated him and shared his thoughts on the significance of mentoring future board members.
‘When I came out of college, mentors were called boss,’ he half-joked. As president of the bank First City Dallas in the 1980s, he said he ‘learned to listen to the wisdom around the table.’
Best described having the ‘great accident’ befall him of encountering the late John P ‘Jack’ Harbin when he became vice president, treasurer and head of corporate development at Lone Star Technologies. Harbin became a cherished mentor, though Best said Harbin would never have acknowledged that publicly. After 10 years at Lone Star, Best succeeded Harbin as CEO and shortly afterwards as chairman of the board in January 1999.
‘I encourage you all to consider mentorship as you go through your careers,’ he said.
The recipient of the B Kenneth West Lifetime Achievement Award, Reynolds, president and CEO of PreferWest, a Seattle-based business advisory group, and a director at Delta Air Lines, BAE Systems and TransCanada, wasn’t able to attend the gala because of -- what else? -- a board meeting. NACD Chair Reatha Clark King presented the award to Gail Grimmett, senior vice president of Delta Air Lines, on her behalf.
Reynolds ‘thrives in difficult industries and in difficult situations,’ Grimmett told the crowd of 350. ‘She does particularly well in leading companies through restructurings and mergers,’ as she has done at American International Group and Safeco Corp, respectively.
Reynolds, too, is committed to mentoring, said Grimmett, adding that she has been under Reynolds’ wing since she joined the Delta board 10 years ago. To illustrate the extent of that commitment, Grimmett told of recently having to give a major presentation to Delta’s board and being asked by Reynolds the day before if she was ready. Although Grimmett said she was, Reynolds walked her home that night from a board dinner offering detailed guidance along the way. ‘My one regret is that I didn’t have a tape recorder with me’ to document the wide-ranging advice for later reference.
The onstage fireside chat among the three Hall of Fame inductees and NACD’s CEO and president, Kenneth Daly, was enlivened by a radio call-in format, with the ‘calls’ from notable people in each inductee’s life having been pre-made.
The first ‘call’ from Wallace Barnes, asking Franklin, former US Secretary of Commerce under George H W Bush, whether she had joined Aetna’s board to meet a husband and was it a fertile field or a barren wasteland for such a quest, drew gales of laughter from attendees. Barnes, retired chairman and CEO of aerospace manufacturer Barnes Group, joined Aetna’s board eight years before Franklin and happens to be Franklin’s husband.
‘I got there in 1979 and he got there in 1971, and we didn’t get married until 1986, so it wasn’t love at first sight,’ Franklin said, adding that they first became friends, taking turns escorting each other to corporate functions. She quipped that while she didn’t have to step down from Aetna’s board as she expected to after their marriage, it was ‘disclosed in the proxy statement under certain relationships,’ and that Aetna considered demanding a finder’s fee.
There were further laughs from other ‘calls’ but the fireside chat also gave the three inductees an opportunity to share insights on issues from succession planning to board diversity to the board’s exercise of its fiduciary duties when approving a cash sale of the company. On the last topic, Steele, former chief justice of the Delaware Supreme Court, said the lawsuit filed against Lyondell after its bankruptcy was his most challenging case. He explained, ‘the Court is looking for a well-informed, well-reasoned' explanation for board decisions, not evidence that it diligently went through a check-the-boxes governance exercise.
Asked about progress in appointing more women to boards, Lang, former president and CEO of Catalyst, a nonprofit membership organization that expands opportunities for women in business, said, ‘We’re not moving nearly as fast as the talent we have indicates we should be.’ She cited the fact that women currently occupy 16.9 percent of Fortune 500 board seats, compared with more than 14 percent a couple of years ago.
‘Every one of us needs to be a catalyst’ in ensuring that more women become candidates for what she called ‘stretch opportunities’ that give people experience leading major business organizations. She said it’s critical that people look beyond the stereotypes to imagine different-looking people in top executive roles.
Photo of Reatha Clark King, Joseph Alvarado and Rhys Best courtesy of NACD.