By Alice Korngold, President & CEO, Korngold Consulting
Investors are focusing on companies that are growing long term value by finding innovative solutions to social, economic, and environmental challenges. Companies are recognizing that in order to achieve their greater potential, they must advance diversity and inclusion. These themes resonate with the conclusions I came to in researching dozens of case studies for book, A Better World, Inc.: How Companies Profit by Solving Global Problems…Where Governments Cannot (Palgrave Macmillan 2014).
The big question is how to develop leaders who will understand the challenges and realize the opportunities for their companies to help solve the most compelling problems. New studies sponsored by nine multinational corporations provide clear evidence that companies are effective in developing more diverse, inclusive, and high performing workforces and finding innovative solutions to world problems when they involve their employees on NGO/nonprofit boards. Additionally, employees are more likely to work for and stay with companies that provide opportunities for nonprofit board service.
Business employees who serve on nonprofit boards develop valuable experience and skills in board governance, networking, communications, and strategic planning. They report that they become better leaders, more confident, accept more responsibility, feel more useful, and become better prepared for promotions.
Business employees rise to board leadership positions within one or two years of serving on their first nonprofit board. Employees who continue for three or more years are even more likely to become board leaders.
Additionally, as you see in the graph above, business employees who serve on boards gain a deeper appreciation for the perspectives of people from different backgrounds than their own, and they become more empathic. The experience changes their behaviors back at work; they listen more carefully to the perspectives of people whose backgrounds are different than their own, and they are more inclusive in forming committees and work groups, and in making hiring and promotion decisions.
Through their service on nonprofit boards, business employees help to advance sustainability and the U.N. Sustainable Development Goals (SDGs).
Companies supporting the Better World Leadership (BWL) studies include American Express, Comcast NBCU, Dow Chemical, HP, Johnson Controls, PIMCO, PwC, Symantec, and Target. The Honorary Co-Chairs for BWL are Grady Crosby, Vice President, Public Affairs and Chief Diversity Officer, Johnson Controls, and President, Johnson Controls Foundation, and Rob Vallentine, President, The Dow Company Foundation, and Director Global Citizenship, Dow Company. The World Environment Center, whose mission is to develop leaders to implement sustainability, is a strategic partner in this initiative, along with IMPACT2030 and PYXERAGlobal.
This year, we are welcoming additional companies to participate in the studies. Each company will receive confidential benchmarking reports comparing the impact of their board programs to other multinational corporations. We are also implementing programs at global companies to scale board training and matching services for hundreds and thousands of employees worldwide. Our unique model, drawn from our experience in training and matching more than 1,000 business executives to nonprofit/NGO boards, uses evidence-based algorithms.
Companies seek to make meaningful advances in growing value by finding innovative solutions to global problems. Nonprofit board service works in developing leaders who can drive progress. The evidence is clear, and an effective methodology is available.
Alice Korngold, President & CEO, Korngold Consulting, leads Better World Leadership. She provides strategy consulting services to multinational corporations and NGOs/nonprofit. Korngold has authored books and multiple book chapters and articles on sustainability, ESG, and corporate governance. Korngold is a Visiting Professor at York University in Toronto where she teaches “Sustainability and Corporate Governance” for the master’s degree program in Financial Accountability.