Age is a Board Diversity Issue

I serve on two international boards and would be considered a “senior” member of each in both age and experience. I believe my experience is important; I’m not certain the age is. I know I’ve lived long enough to get a whopping lot of experience under my leadership belt. But I also know I’m recruiting and encouraging younger people to step up to governance leadership who, despite fewer years of experience, have loads of competencies and seasoning.

While the credit union movement is in active discussion about the need to reach out to young people to become members, the governance discussion in both credit unions and the private sector is about reducing the average age of a board. Suddenly age becomes a diversity issue.

Diversity grew up in an era of respecting differences and viewpoints along the dimensions of race, ethnicity and gender. It has since matured more broadly to include sexual orientation, socio-economic status, physical abilities, religious beliefs, political beliefs, other ideologies and age. While many still see diversity as an equal rights issue, most leadership approaches see it as an intellectual capital issue: The greater the number of perspectives that can be brought to bear on the success of an enterprise, the better.

Why should a broad age mix be important for your board? Let’s consider just a few reasons.

• Any board should reflect the makeup—actual or desired—of its constituency. Credit unions are in significant need of attracting younger members if the movement is to remain relevant to changing demographics and business models. A board with a couple of younger members demonstrates commitment to assure a voice for that population in the credit union’s strategy and growth.
• The innovative and problem-solving benefit of different perspectives. For decades, research has demonstrated that including differing perspectives and experience in the conversation enhances innovation and successful problem solving. When young people around the world are helping advance existing business models, wouldn’t it be nice to have this advantage sitting right in your board room?
• Technology solutions will drive our businesses into the future. While plenty of mature professionals are certainly savvy here, it’s pretty evident that those under 40 are most adept, innovative and comfortable with technology in every facet of their life.
• Social networking and connectedness is a key way to advance an organization’s interests. Which age group is best at this? You guessed it. From LinkedIn to Facebook and texting, the younger population thrives on the networking model and understands how to use it. If you consider creating a sticky market advantage with credit union members a good strategy, you’re going to have to have voices at the table who get the technology model and don’t consider it a passing fancy.
• It’s a new era of work and career. The era of having a job for a lifetime is over. The job that doesn’t depend on technology is antiquated. The means of finding a new job is not the want ads. Significant shifts in the work and career environment mean an older board member may not understand nor appreciate the new rules here. Traditional jobs are giving way to portfolios of competencies that mix and match across a matrix of organizational work and move in and out of individual and team effort. The intern may ask for an appointment with the CEO and any employee may reach across operating units in search of solutions to their dilemma. Hierarchy is less relevant to the work behavior of the younger generations. The implication for maintaining and advancing an engaged organizational culture and effective organization is obvious.
• Non-traditional views of membership, value and responsiveness are driving a new business model. Throughout history in nations and commerce, progress has been made because youth questioned the old guard. This is now happening as the younger population demands different approaches to communication, service, membership, jobs, learning, product customization, and organizational culture. Too often the traditional credit union board is unaware of the shifting models in these domains or quick to pass them off as passing fancies. I helped recruit two 30-somethings to one of the boards on which I serve, and they immediately changed the conversation about our models. For the better. They brought personal experience, a voice for the value of the newer models, and an articulate message about value shifts. And now our board now looks at much of what we do through an entirely different lens. Value added!

I’m frequently challenged on my insistence that credit union boards recruit younger members. One challenge goes something like this: “They are so busy they don’t have time and are not interested.” What that tells me is that stereotypical generalizations are alive and a dedicated search for younger board members has been limited.

Take this fact as evidence: Young people are volunteering in U.S. society at the same percentage of population as are the over-60 demographic. The youth are willing to give and add value if you have an exciting story to which they can contribute. They also like the opportunity to learn about leadership and governance and willingly soak up this experience from board service.

Another challenge to seeking younger directors goes like this: “What would a 30-something know about overseeing a complex financial institution?” Possibly more than an older CPA board member who knows numbers and finances, but is out of the loop on what is shifting in the business environment. We don’t expect younger board members to have run a large multi-national business, but don’t discount the level of business expertise they have. Surprisingly, many of the younger generation are interested in commerce and have substantial experience in the business arena. They are out there, but a thin search won’t find them—you have to work a little harder.

The most despicable objection comes from the old school: “Why would we ask a 30-year board veteran, loved by all, to step aside for a young member?” My answer: to make a legacy contribution to the credit union. Think about it.

Les Wallace, Ph.D., the 9Minute Mentor, is president of Signature Resources Inc. He is co-author of A Legacy of 21st Century Leadership and author of Principles of 21st Century Governance. In 2015, he will lead CUES’ Board Chair Development Seminar  and the fall session of CUES Director Development Seminar.