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What is a board skills matrix?
A board skills matrix is a tool used by a board of directors to assess the skills, experience, and qualifications of its members. It is essentially a chart or table that lists the skills and expertise that the board needs to effectively oversee the organisation, and it maps those skills against the skills possessed by each board member.
The purpose of the board skills matrix is to ensure that the board has a diverse set of skills and experiences that are relevant to the organisation’s strategic objectives and that there are no significant gaps in its collective expertise.
Typically, the board skills matrix includes a list of key areas of expertise or functional areas, such as
- Risk management
- Human resources
For each area, the matrix identifies the specific skills or qualifications that the board needs to possess to effectively oversee that function. Then, each board member’s skills and qualifications are mapped against the matrix, usually through a self-assessment or a questionnaire.
The board skills matrix can be used to guide board recruitment, identify areas where the board may need additional training or education, and ensure that the board is well-equipped to handle the organisation’s challenges and opportunities. It can also be a useful tool for communicating the board’s composition and expertise to external stakeholders, such as shareholders or regulatory bodies.
Commonly required board skills
Board skills are the competencies, knowledge, and experience that board members bring to an organisation to effectively oversee its operations and provide strategic direction. The specific board skills required will depend on the industry, size, and goals of the organisation, but some common board skills are:
- Financial Management. These skills are essential for effectively managing an organisation’s financial resources, including planning, analysis, control, reporting, investment management, and risk management.
- Strategic Planning. This involves developing and implementing a long-term plan that guides an organisation towards achieving its goals and objectives, including critical thinking, creative problem-solving, effective communication, and collaboration with stakeholders.
- Legal and Regulatory Compliance. These skills involve identifying and understanding legal and regulatory requirements and ensuring policies and procedures are in place to meet them.
- Risk Management. These skills involve identifying potential risks, developing and implementing strategies to mitigate them, monitoring and evaluating effectiveness, and communicating with stakeholders.
- Human Resources. These skills include attracting and selecting top talent, providing training and development opportunities, managing employee relations, and ensuring compliance with employment laws and regulations.
- Governance. These involve fulfilling the roles and responsibilities of a governing body and ensuring compliance with relevant laws and regulations.
- Industry Knowledge. This requires knowledge of the industry in which the organisation operates, including history, current state, future outlook, market trends, competitive landscapes, and effective communication and collaboration with stakeholders.
- Leadership. This refers to inspiring, motivating, and guiding a team or organisation towards achieving its goals and objectives, including a clear vision, effective communication, and relationship building.
- Innovation and Change Management. These skills include identifying opportunities for innovation and growth, developing and implementing new ideas, and continuously improving processes and products, as well as effective communication and stakeholder engagement.
- Communication. These skills are critical for building trust, promoting transparency, and ensuring alignment and understanding among board members, management, and external stakeholders, including clear articulation of ideas, active listening, and tailored messaging.
What should be in a skills matrix?
The specific items that should be included in a skills matrix will vary depending on the context and the purpose of the matrix. However, here are some common elements that you might find:
- Skill/Competency. This is the name of the skill or competency that the matrix is tracking, such as “communication skills,” “project management,” or “technical writing.”
- Description. A brief description of the skill or competency to ensure that everyone has a common understanding of what it means.
- Proficiency levels. A list of proficiency levels that can be used to rate or assess team members’ proficiency in the skill. For example, these could be beginner, intermediate, or advanced levels.
- Assessment method. The method used to assess or measure the proficiency of team members in the skill or competency. This could be a self-assessment, peer review, or manager evaluation.
- Team member names. A list of team members who have been assessed for the skill, along with their proficiency level.
- Training needs. An indication of whether additional training or support is needed to develop the skill further.
What skills do I bring to a board?
In addition to the board skills mentioned above, there are several other skills that you may bring to a board, including:
- Digital Skills. With technology rapidly evolving, board members who have digital skills and understand how to leverage technology are increasingly valuable. This includes knowledge of digital trends, data analytics, and digital marketing.
- ESG Skills. Environmental, Social, and Governance (ESG) factors are becoming more important to stakeholders and investors. Board members with expertise in ESG issues and who can provide guidance on sustainable practices and corporate social responsibility are in high demand.
- Positive Future Thinking Skills. Board members who can think creatively and envision a positive future for the organisation are valuable. These skills can help the organisation to innovate and stay ahead of competitors.
- Listening Skills and Emotional Intelligence. Board members who have strong listening skills and emotional intelligence can foster effective communication and collaboration within the board and with other stakeholders. These skills can also help board members to understand and respond to the needs and concerns of employees, customers, and other stakeholders.
In summary, a board skills matrix is a valuable tool for boards of directors to ensure they have the necessary skills and expertise to effectively oversee their organisation. By mapping the skills and qualifications of each board member against the skills required to oversee the organisation’s functions, the matrix helps identify gaps and guide recruitment and training efforts. While the specific skills required will depend on the organisation, there are common competencies such as financial management, strategic planning, legal and regulatory compliance, risk management, human resources, governance, industry knowledge, leadership, innovation and change management, and communication. Additionally, in today’s digital age, board members with digital skills, ESG expertise, positive future thinking skills, and emotional intelligence are increasingly valuable. Overall, a diverse set of skills and experiences is essential for a board to effectively guide their organisation towards success.