What Forward-Thinking Boards Cannot Afford to Ignore

Rich: How have the role of public company corporate boards evolved in recent years, and are they adapting effectively to their growing oversight responsibilities?

Stuart: Great question, Rich. Boards have certainly evolved, and a big part of that evolution is driven by technology. When you consider the global impact of emerging technologies on business—whether it’s artificial intelligence, cybersecurity, or data analytics—it becomes clear that boards can no longer operate the way they did even three years ago.

Technology is now at the core of almost every key board responsibility, from oversight to succession planning.

That means boards must be agile, continuously learning, and willing to adapt to fast-changing dynamics. It’s no longer acceptable to just “show up prepared”—today, a lack of awareness or tech fluency doesn’t just make a director ineffective; it can make them a liability.

Three years ago, boards were more static. Directors had time to learn and catch up, and it wasn’t uncommon to have a few underperformers around the table. Today, that’s no longer the case. Continuous learning and readiness are non-negotiable. One of the most notable shifts is the increased emphasis on independent board assessments.

Directors are asking themselves hard questions: Am I up to this? Can I contribute meaningfully to high-level strategic conversations? And those conversations often revolve around critical decisions like capital deployment and leadership development.

The bottom line is: boards need to fully embrace technology, leverage data, and take governance even more seriously. It’s a complex shift, but it’s essential for staying relevant and effective in today’s landscape.

Rich: I was always told that in a large organization, a leader’s first responsibility is oversight, and the second is succession planning. Boards today are increasingly aware of the importance of both.

While challenges exist—like staying strategic in oversight or making succession planning an ongoing process—how are boards building thoughtful mechanisms to support and challenge executive leadership, fostering accountability, continuity, and long-term success?

Stuart: Succession planning is one of the board’s most critical fiduciary duties. A strong approach includes reviewing succession regularly, on an annual or even quarterly basis.

On one board, I helped set up a meeting calendar for the full year. I told the CEO, “We always see the top four or five executives at our meetings—but we’d like to meet the top 30 people you’ve identified across the organization.”

These individuals came from different functions and backgrounds. It wasn’t about questioning them on the CEO’s performance—it was about providing the board with better visibility of leadership and the effectiveness of recruitment and development efforts.

This kind of exercise provides deep insight into how well the company is fulfilling its responsibilities around succession. It’s part of governance that often flies under the radar but holds real value.

Another aspect of succession planning is strategic alignment.

I remember a board dinner where the CEO was preparing to retire, and we were considering two internal candidates. The Chair asked me to share my views. I responded, “I’d be happy to—but first, can someone tell me where we see this company in five years?” That question shifted the entire conversation. You can’t choose the right leader without first understanding where the organization is headed. Succession at the top should reflect the company’s future, not just its present.

The third and often overlooked area is succession planning for the board itself.

This is where independent assessments come into play—private one-on-one interviews with directors, data collection, and shared insights. It’s essential for understanding performance and planning for board refreshment.

Why is this important? Because every few years, the needs change. One year it’s DEI expertise, the next it’s cybersecurity, then maybe geopolitical risk. If you’re constantly reacting, it creates a kind of strategic whiplash.

That’s why evaluating performance through a peer lens is so useful—it helps clarify who is ready to take on leadership roles across committees, whether in compensation, audit, governance, or even as lead director or Chair.

No one should hold those positions forever. Leadership rotation brings fresh thinking and a healthier dynamic to the board.

Rich: How are boards looking at this uncertainty? What do they do after they identify the uncertainty?

And once they’ve identified the key risks and unknowns, how do they move from recognition to action?

Stuart: What you’re really asking is: how do you turn a good idea into real action? From our experience mentoring over 25 CEOs, we’ve seen that dealing with uncertainty often comes down to how well the board is prepared—and that starts with how they receive information, the quality of their dashboards, and how their meetings are structured.

Boards shouldn’t get into operational details. Their focus should stay on strategy, oversight, and succession planning. Getting too granular wastes time and valuable organizational resources.

Rich: Let’s talk about board compensation and effectiveness—they’re intricately linked.

Stuart: Let’s start with compensation—it’s definitely a hot-button topic. Today’s thinking recognizes that board service demands significantly more time and attention, and as a result, compensation continues to rise.

Personally, I support linking board compensation to stock options and equity grants. That way, board members are more directly aligned with the interests of employees, shareholders, and other key stakeholders. It builds a stronger economic connection to the outcomes of the business.

That brings me to a word I think defines the future of board effectiveness: data.

Are directors confident in using data? Can they analyze it, understand it, and use it to make smart strategic decisions?

In our work with boards, we’ve seen strategic planning evolve—what used to be a 10-year vision is now closer to two years or less. That shift demands real-time, reliable data to support intelligent decision-making.

In short, boards are undergoing a fundamental transformation. Increased compensation must be matched by deeper accountability, broader thinking, and the agility to lead in an environment that moves faster than ever.

Rich: Can you share a recent example of a director who brought strong credentials and experience to the board, but lacked real governance expertise? How did that play out?

Stuart: I don’t believe a director needs to check every box or come in with ten

out of ten experiences. Governance can be learned and that’s a fair expectation.

Governance matters because it sets the tone for trust, fairness, and how information flows across the organization. It’s the framework for how board members engage—with each other, with management, and with stakeholders.

From our perspective, governance is foundational. It signals the company’s values and priorities—not just to employees and shareholders, but to customers as well.

If you’re on a board today, you need to be clear on the four or five key metrics the CEO is held accountable for. Finance is one, and it’s often a strong predictor. Customer service is another, though it’s often misunderstood. And the cost of acquiring new customers can quietly bleed the organization financially.

Technology is also vital. If you’re not actively monitoring cyber and data threats, it’s tough to make smart capital deployment decisions. Finally, there’s culture. What does turnover look like? How engaged are your people?

Those four areas—finance, customer service, technology and culture—form a strong governance dashboard.

Each one, driven by meaningful data, helps boards conduct thoughtful and fair evaluations of the CEO and their senior leadership team.

Rich: Today, companies are placing greater emphasis on customer experience as a key driver of success. Why do you think this shift is happening now, and how are boards starting to engage with it?

What role should customer feedback and satisfaction data play in board-level discussions? And how can a focus on customer experience influence long-term strategy and performance?

Stuart: That’s actually a powerful illustration of the transformation we’re seeing in commerce today. In the past, if a company started losing customers, the immediate response was to ask the marketing department, “Can you figure out why we’re losing market share in this area?”

But there was no real urgency—no sense of immediacy behind those conversations. It was more reflective than responsive. Today, that dynamic has completely changed. If you don’t understand, in real time, why customers are either staying with you or leaving, you’re at serious risk of losing your economic base. And that understanding isn’t just helpful—it’s fundamental to running a successful business.

Given the high cost of customer acquisition and the power of modern data platforms, companies should now have the ability to track and understand how customers are feeling at every touchpoint.

That’s exactly why, for instance, when you get off a Delta Airlines flight—as I did yesterday—you receive a survey within an hour. It asks detailed questions about your experience with the flight attendants, the gate agents, and even the boarding process.

They’re working hard to differentiate themselves through immediate feedback, rather than discovering a month later that a customer has quietly switched to another airline over an issue that could have been quickly resolved.

What’s needed is a clear, focused dashboard—ideally one page—that breaks down customer engagement and retention by segment.

It should tell you where you’re succeeding, where you’re falling short, and most importantly, why. That kind of clarity is essential for making smart, timely business decisions.

Rich: Are boards just looking at data points, or are they really focusing on true data points of the customer experience and questioning management?

Stuart: When recruiting C-suite candidates, one of the key things I focus on as a board member is asking direct, insightful questions.

For example, I often ask, “Can you share your experience in building and leveraging a customer database?” The way a candidate answers that question reveals a lot—not just about their technical expertise, but about their understanding of customer engagement, data strategy, and long-term growth.

It gives me a strong sense of whether they’re equipped to help lead the organization into its next phase. In my experience, these types of conversations are critical to identifying leaders who are ready for the future.

Rich: Activists are increasingly using social media and public campaigns to influence corporate strategy—and now, unions are joining that effort too. How should boards think about and prepare for this new era of high-visibility, public-facing activism?

Stuart: It is the new age of capitalism, which means I want more accountability.

I think activism will never go away in capitalism the way we know it. It is how you respond, and frankly I would say, how you prepare and anticipate somebody knocking on the door. I am not threatened when an activist knocks on the door.

It may be a little uncomfortable, but it is like reading a document that you have never read before. There are times in my professional life where I have to read documents three and four times to really understand them. I do not think it makes me a particularly bad guy. It means I need to continue to learn.

If an activist comes knocking on my door, I think you have to hear what they have to say and then digest it.

Surround yourself with people who understand, are professionals and know how to manage that process and build it into a collaborative discussion. There are nuggets of gold that can fall out of those conversations.

We have had them experientially in our firm over the years. The days of stiff-arming aren’t necessarily healthy going forward. It should not be a threatening exercise.

It does not mean you have to embrace everything they say, but listen to them and then make your own business judgments as required by the Delaware Chancery Court.

People like you, Rich, play an incredibly important role in advising boards that come under these types of situations, not to panic.

I have seen too many people panic. I think a disciplined process around who engages in the conversation, who comes to the table, a full reality which I know you live in, to make it compliant in Reg FD and how you deal with proprietary information becomes critical to the basis for the conversation.

Rich: Let’s take a moment to go back to AI—because it’s influencing everything right now, from operations to cybersecurity and beyond. Yet, when we speak with boards, it’s clear that many don’t fully understand or truly embrace AI, even if they say they do.

Often, the approach is to bring in one AI expert and rely heavily on that individual’s insights. Can you speak to how boards should be thinking about AI and what meaningful engagement with the topic really looks like?

Stuart: AI is being called the next frontier—and with good reason. It’s transforming every aspect of business, from operations to cybersecurity to customer engagement.

For many boards, the natural reaction is, “We need to bring in an AI expert.” That’s a great first step, but it’s really about embracing a new way of thinking. Board members don’t need to be experts themselves, but they do need to get up to speed quickly and confidently.

One of the most effective and practical ways to do that is by bringing in an independent third-party expert to guide the conversation.

It’s a great opportunity to create a shared understanding, not just among directors, but also with senior executives—especially those leading in technology and strategy. From there, even a 30-minute quarterly update can go a long way in keeping everyone informed. AI is moving fast, and regular touchpoints ensure the board stays current without being overwhelmed.

And as AI becomes more embedded in business, so too does the need for thoughtful governance around ethics and values.

Boards should receive regular updates on how ethical considerations are being addressed, supported by real data. Fortunately, today’s AI tools can simplify and streamline that process—making it easier than ever to bring the right information to the table.

This is an exciting time for boards. The goal isn’t just to keep up—it’s to lead with confidence. By staying curious, engaging the right experts, and focusing on learning as a team, boards can help shape a future where AI is a source of innovation, growth, and long-term value.

Rich: One last question that brings together both of our areas. Reputation has become more important than ever—especially in today’s fast-moving, AI-driven world where digital and cyber risks are constant. It’s encouraging to see boards giving this the attention they deserve and recognizing reputation as a vital strategic asset.

From your perspective, are boards approaching this more as a proactive governance opportunity, a way to strengthen trust and transparency, or as part of improving operational resilience? Where do you see boards placing their focus when it comes to reputation in today’s environment

Stuart: To be honest, it’s a bit of a mixed landscape.

Some boards are truly engaged and understand the critical importance of reputation in today’s fast-moving, AI-driven, and risk-filled environment. But in our experience, that’s still the minority.

The encouraging part is that we’re starting to see more boards lean in, recognizing that reputation isn’t just a PR concern—it’s a strategic asset that touches every part of the business.

We were recently part of a board conversation around Directors and Officers (D&O) insurance, and it was a powerful example of how interconnected these issues are. The discussion wasn’t just about policy coverage—it was about ensuring every board member understood how reputational risk impacts both organizational resilience and their own personal exposure.

It helped frame the conversation around responsibility, protection, and smart governance.

There’s a dual purpose here: one, to safeguard reputation and document independent business judgment properly; and two, to act and foster a culture of responsiveness. That’s where agility comes in.

Regular, independent audits—especially quarterly reviews around AI and data risk—can keep boards current and confident. Bringing in a third party to assess where the organization stands and what needs to happen next turns reputation management into a living, strategic discipline.

And that brings us back to the bigger question: Are boards viewing reputation today as a matter of good governance, as a way to strengthen long-term trust, or as a reflection of their ability to respond to operational risk?

In the most forward-thinking boards we’ve seen, it’s all three—and that’s a very promising sign.