Nomination and Governance Committees

Nomination and Governance Committees

Natalia Nicolaidis

30 years: General Counsel

Nomination & Governance Committees (NomGov) are responsible for board oversight and succession, as well as ethics and compliance. They oversee three main processes: candidate selection, board and individual director evaluation, and integrity and ethical decision-making oversight. NomGovs achieve effective candidate selection by using a “skills and experience” matrix. Recent challenges in corporate governance have increased expectations for NomGovs, including considerations of strategic risks, leadership and talent development, ethical practices, and diversity and inclusion. Failure to stay on top of these trends can be costly to companies, as demonstrated by the money-laundering scandal at Danske Bank.

Nomination & Governance Committees (NomGov) are responsible for board oversight and succession, as well as ethics and compliance. They oversee three main processes: candidate selection, board and individual director evaluation, and integrity and ethical decision-making oversight. NomGovs achieve effective candidate selection by using a “skills and experience” matrix. Recent challenges in corporate governance have increased expectations for NomGovs, including considerations of strategic risks, leadership and talent development, ethical practices, and diversity and inclusion. Failure to stay on top of these trends can be costly to companies, as demonstrated by the money-laundering scandal at Danske Bank.

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Nomination and Governance Committees

13 mins 33 secs

Overview

Nomination & Governance Committees (NomGov) are responsible for board oversight and succession, as well as ethics and compliance. They oversee three main processes: candidate selection, board and individual director evaluation, and integrity and ethical decision-making oversight. NomGovs achieve effective candidate selection by using a “skills and experience” matrix. Recent challenges in corporate governance have increased expectations for NomGovs, including considerations of strategic risks, leadership and talent development, ethical practices, and diversity and inclusion. Failure to stay on top of these trends can be costly to companies, as demonstrated by the money-laundering scandal at Danske Bank.

Key learning objectives:

  • Outline the key responsibilities of the NomGov

  • Understand how the role of the NomGov has changed in recent years and the trends impacting them

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Summary

What are the key responsibilities of NomGov?

The NomGov key responsibilities include board oversight and succession, ethics and compliance, risk review, shareholder engagement, and corporate culture. 

They oversee three main processes: 

  • Candidate selection based on skills and qualifications
  • Board and individual director evaluation against industry standards with the help of consultants
  • Integrity and ethical decision-making oversight, which includes effective risk management in the legal and compliance environment and vigilance over industry-related changes. 

What are some recent NomGov challenges?

NomGov's responsibilities are increasing as expectations for sound governance grow. The pandemic and the Ukraine war have impacted corporate governance, and NomGov is expected to consider factors such as strategic risks, ethical practices, and cognitive diversity in board composition. The Securities and Exchange Commission recently amended federal proxy rules to require the use of universal proxy cards in contested elections, highlighting the importance of board effectiveness and director competence. Leadership and talent development, succession planning, and transparency within supply chains are also important considerations.

What trends are impacting NomGovs?

NomGovs are responsible for shaping corporate governance policies and practices in response to fast-changing trends, including ESG, human capital, and diversity & inclusion (D&I). 

With ESG becoming a crucial priority, NomGovs are selecting directors with industry and technical expertise in ESG who can assist in setting a company’s sustainability goals through their industry and technical expertise. 

Human capital management requires talent development programs and connecting the dots between digital and human elements. 

D&I demands transparency and accountability on gender, racial, and ethnic grounds at both board and enterprise levels. Companies are managing D&I as a reputational risk and business advantage over peers. 

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Natalia Nicolaidis

Natalia Nicolaidis

Natalia Nicolaidis has spent 30 years in the financial services industry, including General Counsel to Investment Banking & Capital Markets and Head of Global Risks & Controls. She has founded Dynamic Counsel Ltd, a corporate governance and risk consultancy, and has a portfolio of non-executive board roles in four listed companies. She is a founding member of the Climate Governance Initiative - Greece, an organisation that addresses climate change from the boardroom prespective.

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