Untapped CHRO Potential: From Partnering to Chairing the Board

Abstract

In the changing business landscape most shareholders and investors when making their investment decisions not just look at a firm’s profitability but also consider its corporate citizenship model through its governance practices, leadership talent, ethical behaviour and environmental awareness. Over the years the role of human resource function has transformed from focusing on just ‘hatch, match and dispatch’ to becoming an active partner in business decisions and serving the interests of not just employees but also investors, shareholders and community at large. Increasingly the focal point of regulators is on the nomination and remuneration committee (NRC). This further emphasises the need of HR to act as not only the eyes and ears of the NRC but also as its heart to guide and influence on key people matters. To gain the trust of board members, HR professionals must parallel the vision of the CEO and develop a strong business acumen and customer-focused mindset. It also calls for the HR professionals to act as ‘Credible Activists’ in creating the right culture, candour and openness in engaging and partnering with the board/committee members and key stakeholders. In addition to the board and NRC, HR also needs to gain the confidence of the audit committee, corporate social responsibility (CSR) committee and its shareholders. The time perhaps has come to include chief human resource officer (CHRO) as a key management personnel in the organisation and ‘earn a seat at the board’. Hence it is vital for HR professionals to be future ready and develop their skills such that their contribution in the organisational growth is amplified.