Boards need to help “lift the eyes” of firms
The Productivity Commission has today published two reports New Zealand boards and frontier firms and New Zealand frontier firms: A capabilities-based perspective. They shed light on how boards with the right mix of skills and experience can help “lift the eyes” of firms and assist them to survive and thrive in challenging times.
Supported by the Institute of Directors, the Commission conducted interviews with 22 company directors, who work with dozens of New Zealand’s leading firms. The discussions explored the role of boards in firms’ decisions to scale-up, innovate and expand overseas.
The Productivity Commission also commissioned top international thinkers at the BRG Institute to explain exactly how boards with strong “dynamic capabilities” can help firms innovate and thrive in a challenging and deeply uncertain environment. Dynamic capabilities enable forward-looking, strategic decisions about why and what a firm does. Firms with strong dynamic and managerial capabilities are more resilient and more productive, allowing them to pay higher wages and support innovative cultures.
As Commission Chair, Murray Sherwin, said: “The ability of Kiwi firms to innovate and transform has never been more important. So we asked some of New Zealand’s top directors how boards can help firms achieve their ambitions. They highlighted the importance of directors having the “right DNA” to help grow value, and made practical suggestions that could help all Kiwi firms.”
As David Teece, Executive Director of the BRG Institute and Professor in Global Business at the University of California, Berkeley, also said: “Now, more than ever, boards need to favour the future, tolerate mavericks, and support bold investment to help catapult the best New Zealand firms toward the global frontier.”