The composition of a board is the mix of individuals that a board selects to oversee an company. This includes the proportion of women to men and the proportions of women and minorities and the age of board members. It also takes into account the balance of expertise in management and governance such as fundraising, or legal risk.
Diversity is an important element in a healthy board composition. Many boards are looking for ways to diversify the membership. To determine gaps in diversity, organizations could conduct an audit of current board members and identify which areas of recruitment are most needed. Diversity should be considered across all areas, from race and gender as well as education and age qualifications and experiences.
A matrix of the needs of the board can assist boards in understanding the kind of people they require to fill their boards. A matrix is a grid similar to Excel that lists the characteristics of directors on the board and the skills needed to perform their duties. This information can be used by the committee to develop a shortlist of possible nominees and rank them according to how they meet the requirements.
A board must balance the interests of shareholders alongside those of the management team. This typically means that the board has a mix of outside and inside directors and that the inside directors are experienced in managing businesses or nonprofits. Boards will also have a chairperson who will oversee the work of the board as well as the committees.