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As the corporate landscape evolves, companies are increasingly recognizing the value of including a subject matter expert from the human resources (HR) field on their boards. Traditionally, boardrooms have been dominated by finance, legal and operations professionals, but the tide is shifting as organizations strive to achieve a competitive edge. By incorporating an HR subject matter expert onto the board, companies can tap into a wealth of knowledge and experience that directly impacts financial performance in both short- and long-term goals.
Here, 20 Forbes Human Resources Council members discuss the crucial role an HR expert can play in driving organizational success, from optimizing talent acquisition and retention strategies to fostering a culture of innovation and adaptability, all of which contribute to improved financial outcomes.
1. Crafting Relevant Strategies
With companies facing increasing legal and regulatory scrutiny on a range of work-related issues, having a board director at the forefront of new and emerging human capital issues will enable boards to formulate more relevant strategies and frameworks. Its strategic importance requires expert, contemporary representation to create tone from the top opportunities that drives company performance. - Samantha Martin-Williams, NGM Group
2. Having The Right People On Board
People are the biggest business lever to drive financial performance. Full stop. Have a person on your board who deeply gets it—they understand all things people and people systems. Someone that can help the company ensure they have the right people, the right mix and the right people-plan for what lies ahead. Financials are at the bottom of the funnel (output metrics), and people are at the top (input metrics). - Heather Kirkby, Recursion
3. Fulfilling The Company's Mission
Including an HR subject matter expert (SME) on a company’s board ensures that people, a company’s most valuable and expensive resource, are considered as part of all business decisions. An HR SME, who is a true business partner, will help align employees to achieve strategic business objectives. Those same people harness a company’s “energy” to fulfill its mission, affecting the organization’s financial performance. - Howard Young, Millennium Corporation
4. Activating Talent
HR leaders understand how to activate talent. Companies need to consider how to engage their workforce to achieve results, especially in a tight labor market. HR experts are also amazing at governance, succession planning and risk abatement strategies especially when it comes to dealing with human capital issues. - Tracy Jackson, Clutch
5. Managing And Organizing Talent
Talent is the only true competitive advantage. If you're not having board-level conversations about succession, your leadership bench and DEI, you're not taking the long view on the bottom line. If you're not discussing retention, compensation strategy and being an employer of choice, you're not minding the shop on the short-term financials. Talent management is asset management. - Helene Lollis, Pathbuilders
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6. Considering Organizational Needs
I speak with leaders all day, each of whom has detailed business plans and clear strategies for growth. When I ask the question, "Who will do this work?" I'm amazed at the number of "I'm not quite sure" responses. Focusing on HR at the board level ensures org and talent development needs are considered and prepared for, creating a healthier overall company strategy. - Rick Rittmaster, CorTalent
7. Offering Human Capital Management Insight
An HR SME on a company board can provide critical insight into human capital management, ensuring effective talent acquisition strategies, targeted employee development and above-average retention rates. This leads to a skilled and engaged workforce, boosting productivity and innovation and ultimately driving financial performance for short- and long-term goals. - Tia Smith, Collaborative Solutions
8. Bringing Meaning To Strategic Analysis
Our people and the way they sync in harmony is the one thing that cannot be duplicated by competition or digitalized. Employee contribution and the culture created by them is the unique identifier of any organization. Having the HR expertise on the board level keeps the pulse on this most effective, yet overlooked value proposition and brings meaning and soul to any data or strategic analysis. - Gonca Icoren, Energy Vault Inc
9. Partnering With Internal CHRO
An HR leader on a board who is tasked with acting in a fiduciary capacity can directly contribute value by partnering with the internal CHRO on compensation matters of senior executives. These board members can indirectly influence financial outcomes by lending expertise on DEI and talent management strategies. - Karen Hill, Otis College of Art and Design
10. Ensuring People-Centric Decisions
An HR expert on the board ensures people-centric decisions at the highest levels of business, which is essential to driving company performance. HR experts also strengthen and align talent strategies with business goals, ensuring short- and long-term financial performance and growth. Strategic HR leadership is vital to the success of any business. - Marcus Bryant, Second Harvest of Silicon Valley
11. Seeing Employees And Training As A Profit Center
In a rash of skills gaps and talent deficits, there’s a linkage between retaining high-value employees and bottom-line performance. Satisfied people mean lower hiring costs, more stable institutional memory and better ROI. HR can make that case in the boardroom quarter by quarter. In the longer term, having an HR presence helps a board of directors see people (and their training!) as a profit center, not a cost sink. - Graham Glass, CYPHER Learning
12. Connecting Talent Strategies To Business Objectives
Organizations are made up of people and, increasingly, boards are focused on organizational culture. HR leaders are best positioned to provide related expertise as HR subject matter experts often have the deepest insights and most valuable experiences that highlight how best to connect talent strategies to business objectives, including the financial levers associated with those strategies. - Jennifer Rozon, McLean & Company
13. Supporting DEI Initiatives
Employee productivity directly affects the financial performance of a business. Including an HR expert within the highest ranks of your business adds a valuable and much-needed perspective relevant to business decisions that will undoubtedly affect team members personally, from acquisition and retention to diversity and inclusion and company culture and training. - Laura Spawn, Virtual Vocations, Inc.
14. Enhancing Employee Engagement
Including an HR expert on a company's board of directors can improve financial performance by enhancing talent acquisition and retention, performance management, DEI initiatives, compliance and employee engagement. This leads to increased productivity, innovation and reduced legal risks, resulting in improved profitability in the short- and long-term. - Smarthveer Sidana, HireQuotient
15. Considering Succession Planning
Including an HR subject matter expert on your company board can drive the organization's financial performance in both the short- and long-term process through various ways: talent acquisition and retention, employee engagement and satisfaction, succession planning, compliance and risk management, strategic workforce planning and performance management. - Britton Bloch, Navy Federal
16. Maximizing Your ROI
Good HR keeps the tone of your employees by engaging with employees and building multiple data points throughout the employee lifecycle. There is little investment that doesn't directly affect the employees, so don't miss out on bringing in the subject matter expert on your people into the discussion about where to spend money and maximize your ROI in the short and long term. - Jessica Wallen, Marten Law
17. Providing Actionable Guidance
Including an HR subject matter expert on your company board can drive the organization's financial performance in the short- and long-term by providing actionable insights and guidance on talent acquisition and retention, employee engagement, succession planning, training and development, cost management, organizational culture, compliance and DEI initiatives that drive business performance. - Loren Rosario-Maldonado, Cultura, Inc.
18. Understanding Talent-Specific Challenges
HR leaders understand the challenges of inclusivity, culture, pay requests, promotions and talent acquisition. Nothing gets done without people. Having someone in HR on the board can help with all of these issues, which then can help corporations and organizations make better decisions to make their employees happier. Employees are the second most important stakeholders next to their customers. - Matt Strauss, RiseKit
19. Developing A Strong Culture
HR experts can guide leaders in making decisions that will develop a strong culture, attract new talent and motivate employees to succeed. As a general rule, the most productive employees are the happiest employees. HR experts understand which policies, communications, events and systems create a culture in which employees will feel appreciated and supported to do their best work. - Niki Jorgensen, Insperity
20. Creating A Workforce Strategy
The highest value and the majority of the cost to a company are its people. Workforce strategy will continue to be a key differentiator and driver for a company's performance. Leaders need to understand their team, strategy and people as well as the impact of the same on the bottom line. An HR Leader on the board will add the needed people strategy insights that are critical to winning. - Julie Hankins, NNIT
