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Wanted: directors who can take the clients’ view

By Jessica Tasman-Jones

This article is brought to you by Agenda, an FT Specialist publication that focuses on corporate boards

Boards are now looking for independent directors with “customer perspectives” – either professionals who have experience of dealing directly with a company’s clients or those who have worked for their clients.

The boards of technology companies increasingly include members that “represent the client perspective”, says Spencer Stuart, the international recruitment company.

Such directors’ expertise includes improving professional relationships, identifying new customers and boosting marketing, says Lisa Caswell, a consultant with Spencer Stuart.

They help boards to understand clients’ priorities, how customers buy products and services, and how their finances are run.

The new incumbents’ backgrounds vary. In the tech industry, the role is sometimes filled by a chief data officer, a chief financial officer or a board member from a retailer who has been a chief digital officer in the past.

Sarah Rae Murphy is one example. She was appointed as a director at Cisco Systems in California in August to develop customer strategy, having worked at United Airlines. She has experience in “leading a large enterprise organisation through a transformation aimed at enhancing customer experience”.

Awo Ablo has joined the board of Oracle, the Texas technology company, to help it meet the needs of governmental customers. She previously worked with heads of state and officials while at the Tony Blair Institute for Global Change, an NGO adviser.

In the UK, companies increasingly want both qualitative and quantitative insights into customers’ organisations.

Traditionally, these have been presented to the board by executives, says Jonathan Smith, a consultant to the UK board and chief executive practice at Stuart Spencer.

Now, though, many UK boards look for directors who are familiar with their products or services from a user’s perspective, Smith says. Such people can provide feedback to executives on marketing and pricing strategies.

He warns, however, that conflicts of interest can arise when a board appoints a serving executive from a client company.

In the UK, directors have to avoid conflicts of interest, says Sarah Turner, a legal director at Eversheds Sutherland. Under UK law, however, they can still serve in certain circumstances if they have approval from the board.

Trying to recruit recent retirees to bring a client perspective is one way to avoid creating a conflict and customer advisory boards are another option, says Smith.

This article is based on a story written by Amanda Gerut for Agenda.

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