Pam Scott is a familiar face to many Boston Club members, as she served for the past 5 years as a board member and was recently honored in June with the 2013 Deane Laycock Award. Her work on both corporate and nonprofit boards is impressive and extensive, and she will serve as the moderator for the Nonprofit Board Panel as part of Board Education Week on Thursday, December 5. We recently spoke with Pam about her experiences serving on both corporate and nonprofit boards.
Q: In your many years of experience serving on both corporate and nonprofit boards, what do you see as the similarities? The differences?
A: Let's start with the similarities. There are a number of good practices that both corporate and nonprofit organizations can follow, including putting in place strong leadership at the executive director and senior management level. Strong leadership certainly has a positive impact on the board. The opposite is true, too: strong board leadership has a direct impact on senior management. In addition, the level of communication between senior staff and the board must be direct, open and honest--data should flow easily between the board and the organization.
Another similarity is governance. The more structured the governance, the higher the chance that the board will be effective and accountable. In the strategic planning process, there should be joint determination and ownership. Organizations in which board members understand their roles well function better and are more proactive, as there is no ambiguity about authority. Lastly, there is a growing need for transparency on both sides. Corporations are under increasing scrutiny from investors, and donors and funders for nonprofits are increasingly looking for accountability.
Let’s move on to the differences. First of all, the constituencies for corporate and nonprofit organizations are different--it's shareholders vs. clients, funders and donors. The dominant influence on the organizational strategy is also different. Business results influence the corporate side, and missions influence nonprofits. The strict financial structure that permeates the business world isn't always followed in nonprofits.
Engagement of the board can be, at times, less than optimal in either situation. This is often more of a challenge with nonprofits than with corporations. Corporate directors know they need to be present, whereas nonprofit board members do not always have that level of commitment. Size is another determinant. Corporate boards are usually no more than 12-13 people. On the large nonprofit side, there can be 50 or more people on the board. This is great for fundraising, but can be very hard for communication.
Nonprofit boards may not appreciate the fiduciary responsibilities as much as the corporate side does. There are different regulatory requirements on both sides. On the corporate side, it's much stricter. Nonprofits are running into more regulations as far as reporting requirements, but it's clearly there for corporations.
Q: How has your experience serving on boards impacted your work as a consultant?
A: I've been involved with boards--healthcare, social services, financial institutions, social services, arts, education and beyond--ever since I entered the business world. I have been through the decision-making process on a number of different issues. I also have a large network of resources to call upon because I've been around and have seen what and who other organizations have used. I'm not coming at consulting with only an external view, but have actually made big decisions inside organizations. This experience adds to my credibility.
For example, I'm in the midst of a series of capital project decisions at Salem State that will help expand and improve campus facilities. I was an Overseer at Tuck School of Business at Dartmouth College for nine years, and we had to make similar decisions, which directly inform my decisions at Salem State. I have board level understanding, commitment and clarity around the steps, language, and pitfalls that can come as a part of this process. I've also been able to recruit experts in needed areas to the boards I sit on.
Q: What do you believe is an organizational benefit of having women board members?
A: Let's look at it from the standpoint of what women bring to the table. Of course, these are broad statements, but women bring management skills to a board (from business activities, their homes, etc.) and I think women approach situations in a more orderly fashion. They are capable of and willing to consider multiple audiences and stakeholders. There is clear evidence that women are major consumers and they bring that perspective to the board room. I recently met with a group of recent college grads who were heading off to business school, and one thing I encouraged them to do was to get involved in nonprofit organizations so they gain the experience of bringing their business skills to another table.
Q: How can organizations take steps to build more diverse boards?
A: This applies to both corporations and nonprofits. Both types of organizations can increase involvement with diverse individuals in their programs (what do our panels look like? who is representing us? what is the makeup of our own organization?). All organizations should have activities through which they touch a diverse population to get their board members and management staff to expand their networks and expand their own candidate pools. What they do should include diverse professionals who could be board candidates.
In addition, organizations should look closely at the skill sets and demographics already on the board and reach out to diverse candidates who are not only representative of stakeholder groups, but also have expertise in needed areas. All organizations should make diversity a priority. A diverse pool of candidates should be presented to the board to choose from, and they should enlist the help of organizations like The Boston Club and others to source diverse candidates. I can personally thank The Boston Club for having opened both a nonprofit and a corporate board opportunity for me. Things do take time, and we can't solve problems overnight. But, even without goals, diversity can still be a priority that can be addressed.
Q: What is the most important thing you have learned about effective board service?
A: I feel best about the situations in which I have the most personal commitment and engagement. In fact, it's essential that I feel I have that level of that commitment and that I am inspired to participate at a very high level. I think the most effective boards are the ones that have the strongest leadership and the most focus on board engagement and communication. If I can't sit on a board and be a good ambassador, it won't last. I've learned that when I have too many commitments, I become scattered. So, I've learned to contain my commitments to a reasonable number and dive deeper into each one.
Q: If you could give one piece of advice to women looking to serve on a board, what would it be?
A: If you are interested in nonprofit board service, find an organization whose mission resonates with you, and for whom you can be a passionate advocate and ambassador. Being able to identify with the organization is key.
If you are interested in corporate board service, you must evaluate whether you have the personal and professional interest in it. It can make significant demands on you as an individual, so you must understand if it fits with your lifestyle, interests, professional aspirations, etc. You must also take concrete steps to interact with people who have access to, and who know about, opportunities, and who can introduce you to influential people.
Q: Do you have any parting words of wisdom?
A: I feel I have really learned something in business which I can share, and that makes me happy. For example, I've worked for 30+ years in financial services and now I can apply those years of experience directly to other smaller banking institutions and nonprofit organizations. When I walk away from board meetings, I feel good about being a part of helping organizations meet their challenges.
Pam Scott is President and CEO of LVCC, Inc., a business consulting firm that advises businesses and nonprofit organizations on marketing, strategy and organizational issues. She has more than 30 years of sales and management experience in financial services and investment management. Prior to forming LVCC, Inc. in 2003, Pam was Senior Vice President at State Street Corporation where she managed investment relationships with mutual funds, corporate and public pension fund investors and led State Street Global Advisors’ Charitable Asset Management Department serving non-profit organizations.
Pam began her career in investment management at Citibank and has also held sales, marketing and management positions with several other global investment firms in the New York City area. Pam is a former independent director of two Boston area community banks, Danvers Bancorp, Inc. and Beverly National Corporation. As a corporate director, she has been an active member of the Boston Chapter of Women Corporate Directors and the National Association of Corporate Directors – New England Chapter. She was selected by Agenda, a Financial Times Group publication, to be profiled in their 2012 directory, The Agenda Compensation 100, a listing of 100 top corporate board candidates.
In 2009, Pam was appointed trustee to Salem State University by Governor Deval Patrick and currently serves as Chair of the Board of Trustees. She also serves as a Director of the United Way of Massachusetts Bay and Merrimack Valley and an Overseer of Beth Israel Deaconess Medical Center. She has also recently served as Director of The Boston Club, an organization of senior professional women, an Overseer of the Tuck School of Business, President of Girls, Inc. of Lynn, Director of Celebrity Series of Boston, Director of the National Association of Securities Professionals (NASP) and President of NASP-Boston Chapter. She was recently honored by the Boston Business Journal at their 2013 Advancing Women event and by the Association of Rice Alumni as well as the Association of Rice University Black Alumni for her professional achievements.
Pam, a Houston native, holds a BA in Economics from Rice University and an MBA in Finance from the Tuck School of Business at Dartmouth College.