On Policy

When pondering boardroom challenges, it can be useful to adopt the independent perspective of the proverbial “alien” from Mars visiting Earth for the first time. What would such an intelligent being see? Small groups of humans, meeting less than a dozen times per year, making strategic and financial decisions on behalf of others based on inevitably incomplete information about a world with powerful forces beyond their power to control—from high-speed algorithmic trading that can move markets to cyberattacks that can paralyze systems, to name just two of the countless areas commanding director attention today.

Viewed thus objectively, directors have a seemingly impossible task. And yet since the very first joint stock companies were formed to explore the New World, directors have been building an enduring global economic system, bringing products, services, and employment to billions of people despite economic depressions, political revolutions, and natural disasters, among other risks.

How? In one word, policy: a “set of ideas or a plan of what to do in particular situations that has been agreed to officially by a group of people, a business organization, a government, or a political party,” according to the Cambridge English Dictionary. In this sense, all the significant turning points of Western civilization—from the creation of the Magna Carta to the United States Constitution to the Paris Agreement—are nothing more or less than policy.

As I look back on the history of NACD, I see that many of our greatest contributions to society have been in the realm of policy. Through our 30 years of Blue Ribbon Commissions, our Key Agreed Principles to Strengthen Corporate Governance for US Publicly Traded Companies, our Future of the American Board initiative, and our various position papers and blueprints, we are continually providing policy guidance. What should directors do about artificial intelligence? Climate risk? Cybercrime? Diversity and inclusion? Inflation? For years we have been convening directors to explore and answer such questions.

I am particularly aware of the breadth and depth of our guidance at this time. Our entire organization has been engaged for the past year in organizing our knowledge base for the launch of a high-tech, high-touch website and learning portal prior to our annual Summit this fall. In overseeing the process of content conversion, I am continually amazed to see that for every emerging problem, we keep offering ideas and plans of what to do in various situations. We want to help you succeed in what may be the world’s most challenging—and important—job. ■