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Clueless Boards

February 9, 2022 by Twan van de Kerkhof

Supervisory board members are not ready for the future. They have “shockingly limited knowledge” of ESG issues, write Paul Polman and Andrew Winston in their book Net Positive. The authors are very negative about both the mindset and the capabilities of current board members. “Many boards have corporate social responsibility committees, but the people on them generally aren’t qualified”, they write. And: “Most directors don’t really care about ESG. Few boards represent the world around them, most don’t know what ESG means, and very few can tie it to strategy or long-term value creation. They’re grossly out of touch with what’s happening out there.”

I am surprised by the negativity in the book, given the extensive experiences both authors have with a wide variety of board members all over the world. I assume that most current board members won’t recognize themselves in this bleak picture. So they either overestimate themselves or Polman and Winston are wrong in their assessment.

Their solution is simple: “For current board members, we recommend mandatory training in ESG and on climate change specifically.” And new board members should be more often of color, female, or younger than the usual suspects. “The diversity will help the company to navigate the world.” I can imagine that more diversity will bring more perspectives into the business, but I wonder if it will be the solution for everything.

This is the last of a series of blogs about “Net Positive”, an important book by Paul Polman and Andrew Winston. See the other blogs on this website.