Why is communication increasingly on the boardroom agenda?

By Xavier Prabhu, afaqs!, | November 16, 2012
Xavier Prabhu

Instead they are forced to operate in full view of the media, investors, stakeholders, regulatory bodies and governments. Higher awareness of the consequences of non-performing/weak boards is leading to increased scrutiny and push towards higher transparency and accountability. Here, throw in expectations of being a good corporate citizen, ever demanding/prickly employees and higher complexities of operating internationally. No wonder, boards are being reshaped on a scale not seen before and the boardroom agenda is being rewritten all over. Both developments are a windfall opportunity for communicators as this leads to them increasingly having either a seat at the table or a voice in the boardroom. Seven reasons (in no particular order of importance) behind this paradigm shift are outlined in this article.

1. Communication becoming a key element of boardroom effectiveness/success - It may sound biased coming from a communication professional. Increasingly, effective and dynamic communication, both with stakeholders (customers, staff, investors, etc.) and within the boardroom is essential for boards to implement the new agenda. Beyond the content, increasingly it is about how and what methods are used to communicate besides the image projected. A board that sends outs its messages using new mediums like social media (with its own attendant challenges) sends out a message of being in with the times and dynamic. A board that comes across as socially responsible creates positive ripples of goodwill and perception. A board that is seen as aware and attentive to multiple local market sensitivities gives a distinct edge in the markets the company operates in. Turning to communication inside the boardroom, it is increasingly about creating an environment where tough questions and intense discussions are done and answers sought and consensus achieved and how the agenda is shaped to be inclusive.

2. Corporate affairs and communication is getting more strategic - Corporate affairs and communication as a discipline is truly coming of age. More and more business people are recognizing reputation as a key ingredient of business success and not just a feel good thing. Aided in large measure by empirical evidence of reputation's direct impact on the bottom line. As businesses and trade become increasingly global, the complexities impacting reputation has simply leapfrogged. More and more employees are located far away from the corporate HQ and the stakeholders can be from any part of the world, and increasingly are. Not to mention important questions over trust in businesses and the role of business beyond the numbers. Admittedly, the whole value companies place on corporate affairs and communication has risen markedly and the function/team getting deeply involved in direction-setting and such key decisions. Because communicators are at that interface between external and internal, they have a perspective that a lot of those in boards may lack. This has led corporate communication professionals develop a growing understanding of the company's business model and how it creates value. In a remarkable shift, today, to effectively carry out the corporate affairs role now you have to become both business and financial literate.

3. Growing pool of high-quality professionals with a business view & inside understanding - As is evident from the preceding pointer, the soft and fluffy view of communication and its practitioners thankfully is giving way to a function/breed of professionals who have a hard-headed understanding of the rupees at stake when it comes to a company's reputation. The more this happens across companies, the more the number of professionals available with that strategic insight and knowledge necessary for playing bigger roles. No wonder then, there are increasing instances of comms.professionals becoming CEOs (Sue Clark of SAB Miller, John Fallon at Pearson etc.). There are also examples of those from PR backgrounds getting to drive marketing functions in a reversal of trends.

4. Increasing focus on being good corporate citizens - Today, most businesses are asked about and being told to focus on their role in areas that we would never have thought were the primary responsibility of business in the past, like being sustainable, being a equal opportunities employer and commitments to tangibly reduce carbon footprint etc. Also, NGOs are maturing, instead of seeing business as from Venus, a number of NGOs are seeing them as partners who can get things done, particularly in countries like India where the government can only do so much in multiple key areas.

5. The desire for plural and representative boards - Good for-profit and not-for profit organizations make it a point to have independent boards who truly act as an effective oversight body. These boards are diverse in the true sense of the word, not only when it comes to gender but also in terms of professional background, sectorial expertise, color, age, nationality, etc. Making boards truly representative, independent and plural and diverse is something that communication professionals probably are more adept at advising.. Also they are better qualified to provide that view and input as well inside it.

6. Crisis management and communication as a more frequent visitor - Due to reasons discussed above, crises are an inherent part of any large organization's existence. It could be CEO exits (more of them are becoming noisy), harassment/unethical behaviour of senior executives, activist shareholder actions, NGO campaigns, governmental or regulatory interventions/penalties, accidents at work to product/service issues. Who better to provide counsel to manage reputation and business risk at stake in all these instances than communicators?

7. The rise and rise of social media - The impact of social media has been written to death. Suffice to say that it has wrought change not just in all walks of life and business and boardrooms cannot be an exception.

As someone passionate about communication as a discipline and as a strong believer of its even more crucial role in the 21st century, it is exhilarating to see this paradigm shift of communication increasingly figuring on the boardroom agenda and communicators getting a seat at the table.