Though it's by no means a megatrend, the number of corporate boards adding international directors is steadily growing (even at smaller, hometown companies where none of the staff ever used to need a passport). Tech firms, particularly, may have research and capital people from around the globe in their boardrooms.
But multinational business blends increase the danger of culture clashes. Such miscues are especially common (and dangerous) on a board, where the stakes are so high, and where so much of the value-added comes through personal interaction. How can you guard against "international incidents" in your boardroom?
- Learn what "corporate governance" really means in the foreign director's culture. A U.S.-based firm added a noted Japanese national to its board, but was disappointed when (despite excellent English language skills), he sat silent as a stone through the first several meetings. The board chair later took this same director out for a one-on-one dinner, and found him open with valuable ideas -- and puzzled by the "odd" way U.S. board meetings worked. In Japan, it turns out, board members tend to talk through board business in advance of the board meeting, and the actual meeting itself is merely a quick, legal affirmation of what's already been decided.
- By global standards, the American boardroom is a pretty freewheeling place. "Americans have a style that combines informality with aggressiveness, and many cultures find that confusing," notes Pam Pappas Stanoch, chief at Minnesota-based culture consultants Window on the World. "The Scandinavians or Dutch, for example, find U.S. boards informal, but at the same time assertive and non-inclusive. Americans tend to push their ideals, but the other cultures are more consensus-based and inclusive," she adds. Some foreign directors may seem to acquiesce to pushy Yanks, but in fact may be taking a passive-aggressive role that in the end sabotages a proposal. The moral: don't assume that boardroom silence means consent.
- Most world cultures find family and personal ties at least as important as business relationships. American boards tend to miss this culture shift. "Three U.S. directors joined the board of a major Brazilian firm," recalls Stanoch. "They attended their first board meeting, but after 2 hours, the chairman called for an adjournment until tomorrow. His mother was going on a trip, and he wanted to visit her before she left. The other local directors saw nothing wrong in this, but the Americans were disappointed and even sarcastic about the delay."
The more mixed your board, the more you should slow the pace, and the more interpersonal time you should offer for bonding. "Build in time for informal relations, with longer breaks and more time for directors to rest their minds and share information," says Stanoch. Remember that taking part in a board meeting held in a second language demands a much more tiring mental effort for your international members. Speaking of languages, consider translation for some board materials to ease this burden, and also to make sure no directors feel left out of the info flow.
Copyright Â© 2001 Ralph Ward's Boardroom Insider