What is a Board Skills Matrix?
A board skills matrix is a tool used to provide an overview of the skills, expertise, and characteristics of board members. The matrix can include different elements such as education, experience, gender, age, industry knowledge, and specific business-related skills. By outlining these diverse attributes, a board skills matrix provides a clear snapshot of the board's collective abilities and identifies gaps.
The AICD provides a Board Skills Matrix tool for directors and AICD members for free.
How Does a Board Skills Matrix Benefit a Company?
The board skills matrix has benefits for both the company and its stakeholders. It enhances decision-making and board effectiveness by ensuring board diversity and coverage of necessary skills. A diverse board provides a variety of perspectives, encouraging innovative thinking and robust discussions.
Moreover, the skills matrix can identify skills gaps in the current board, helping to guide recruitment efforts when filling board positions.
The matrix also increases transparency to stakeholders about the board's composition. It gives investors insights into how well the company's board is poised to steer the company, which can influence their investment decisions.
What Skills Should be in a Board Skills Matrix?
Depending upon the business and industry, a company may need board members with various technical skills, such as financial literacy, knowledge of the industry, or experience in corporate governance. These specifics will vary, but every board should include member skills such as strategic thinking, sound judgement, integrity, and the ability to work within a team. You can read about these attributes and skills, and see suggested compositions with our free tool here.
Given the crucial role of a board in a company's success, it's essential to have a well-composed and diverse board. The board skills matrix is a crucial tool to help achieve this goal and should be an integral part of board composition and recruitment strategy. By efficiently using this tool, companies can increase their effectiveness and transparency, enhancing trust and ultimately the success of the company.
View the AICD's Board Skills Matrix tool here.