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Strategy and Operations

Report: Boards Seeking More Subject Expertise

NACD’s governance survey found that boards are facing more challenges than ever, and are seeking leadership help beyond strategic planning.

Board members are feeling more pressure to respond to economic and technological challenges, prompting narrower strategic-planning windows and a search for subject matter expertise, according to a new report.

The 2025 Governance Outlook, published last month by the National Association of Corporate Directors, is based on a survey of 251 corporate board members. The most common trend for 2025 selected by participants was “shifting economic conditions,” reflecting concerns that the incoming Trump administration will “pursue protectionist economic policies and create a shift in U.S. relations with allies and adversaries alike.”

Though less than 10 percent of respondents anticipated a recession as a result of those economic shifts, larger numbers see the current environment as more volatile overall: Nearly half said that crises are more frequent, and more severe.

Moreover, leaders say they now have more on their plate than ever before. According to the report, “nearly three-quarters of directors indicate that both the number of topics on the board agenda and the number of issues that individual directors must monitor have increased.” 

Those increased rapid economic and technological shifts have prompted organizations to rethink what “long-term” means when it comes to strategic planning. According to the report, the percentage of companies that use a time horizon of less than three years for that planning, has increased from 9 percent in 2022 to 13 percent in 2024. Currently 70 percent of organizations set a time horizon of three to five years.

Two thirds of respondents said ‘specific expertise’ was the most sought-after characteristic in their next board recruit.

To respond to those trends, the NACD report advises board members to pay increased attention to risk management. “An agreement should be reached regarding what early warning signals should be reported to the board and which metrics will be used to gauge progress of innovation bets,” the report says.

Boards might also consider a more fluid approach to strategic planning, the report suggests, developing responses to different potential outcomes. “Many organizations are moving away from traditional, long-term planning to a continuous approach to strategic planning,” the report says. “This involves frequently exploring and pressure testing different strategic options. Meanwhile, boards can use scenario planning and have management develop a wide range of scenarios across a range of time horizons. By pressure testing assumptions in this manner, boards will be better prepared to adjust strategies as needed while maintaining a focus on long-term goals.”

This more fluid and situational approach to governance has prompted many organizations to rethink the makeup of their boards, the report says. Rather than relying on general leadership and strategic-planning expertise, boards may be more open to soliciting input around particular areas of concern—cybersecurity, for instance—to assist in their decision-making. Two thirds of respondents said “individuals with specific expertise” was the most sought-after characteristic in their next board recruit.

But the report recommends that boards strive to keep that expertise in balance with the board’s broader strategic goals. “Rather than creating a collection of single-issue experts on the board, the board should work to improve its collective proficiency on mission-critical issues such as new technologies or industry matters,” the report says. “To this end, boards should consider developing a collective learning plan that will raise the proficiency of all members. The onus will be on individual directors to stay curious and continuously learn.”

istock/VioletaStoimenova]

Mark Athitakis

By Mark Athitakis

Mark Athitakis, a contributing editor for Associations Now, has written on nonprofits, the arts, and leadership for a variety of publications. He is a coauthor of The Dumbest Moments in Business History and hopes you never qualify for the sequel. MORE

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