Chairmen and Non-Executive Directors carry a level of publically-visible accountability like never before. The composition of the Board is central to the progress of Life Sciences businesses and needs to develop at key stages in their commercial evolution. Strengthening Boards can involve adding specific industry, functional or geographic expertise and skills. However, a Board’s Chairman needs to ensure that there is a balance between engagement in the business and maintaining best practice Governance. Coulter Partners is a world-renowned Life Sciences search organisation, advising the leadership of Pharmaceutical, Biotechnology and MedTech companies. Its consultants discuss how to improve Board effectiveness through diverse and strategically-aligned hires...


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How and when are you typically asked to help strengthen a life sciences company’s Board?

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What is more important now; specialist expertise or Board experience?

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How do Boards balance making a contribution to running the business with ensuring best practice in governance?

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What about popular business themes like globalisation, talent and diversity? Are life sciences Boards seriously engaged in these matters or just paying lip-service?

Bianca: Other than appointments arising from normal Board retirements, we typically find that we can add most value when a company faces a critical stage in its evolution; progressing towards the clinic, arriving at the commercial development stage; contemplating an IPO or other financing/corporate development event, entering a new geography or strategic direction, merger or acquisition.

After a long period of relative dormancy, and significant financial crisis which caused huge funding challenges for the sector, the capital markets are incredibly buoyant. Investor confidence seems very high and while some fear this is a bubble, there is significant investment flowing into companies, some of whom have ambition to build truly sustainable businesses. We have seen record numbers of Life Sciences IPO’s, obviously particularly in the USA, and confidence in Europe has also blossomed. We have many clients who are searching for Board members both sides of the Atlantic.

Irene: But Board directors who have gone through the IPO process are in short supply and great demand. Many with experience have now retired. A high percentage of executives experiencing the IPO process are doing so for the first time. As a result pre and post-IPO Board experience is in high demand. We closely monitor Board members who have had experience of helping Life Sciences companies complete successful IPO‘s.

Clare: A high-calibre Chairman and Board will help management teams make the cultural transition from private to public ownership. The Board can bring its knowledge to bear on risk management, internal controls, investor and media relations, corporate strategy and development, and of course corporate governance. It can help ensure that the IPO process does not detract from the successful running of the business, and increase investor confidence. Getting the Board right helps maximise the chances of a successful flotation and execution of corporate strategy.

Geoff: It is unusual for the Board composition of a private company to have the right mix for IPO preparation or afterwards. We often see Boards made up of founders and investors and lacking independent Board members. If a company is thinking about doing an IPO then it should start changing its Board early enough. Ideally if a new Board member can join a year in advance this allows the new Chairman/Director to get to know the executive team, and fully understand the strengths and development needs of the business. It may not be possible to have everyone in place in time for the IPO but prospective investors will want to see the foundations of a strong Board. City audiences will expect credible non-executives to be appointed to chair the audit and remuneration committees.

Irene: Life sciences companies are now increasingly focusing on recruiting independent directors, and often prefer those with specific sector expertise. After a wave of corporate scandals a decade ago many life sciences firms behaved like firms in other sectors. They recruited financial specialists and outside executives to their Boards. More recently the trend has been towards adding directors with life science industry expertise to provide the level of informed oversight the sector demands. Understanding of the drug development pathway is vital.

Geoff: Life sciences industry veterans are often judged to be better equipped both to performance manage and to counsel the chief executive. Sometimes, of course, a Chairman (in particular) is selected with a different industry background to bring new thinking and perspective. Directors with industry expertise and strong track records can help companies make good operating and strategic decisions, and depending on the situation, having scientific and regulatory depth can be vital to credibility. Equally, a balanced Board has to have the right commercial expertise for its current and future stages of development and can benefit from experience gained in other sectors. Most of our work, however, involves finding tightly defined profiles with highly specific expertise of direct relevance to the corporate strategy of our client.

Bianca: We frequently recruit experienced chairmen and directors who can help transition a company from being R&D focused to having a clear commercial strategy, or to drive scale-up, make a business ready for a major commercial transition and/or M&A. Sometimes credibility and track record with the financial markets can be as important as reputation within the sector.

Clare: Being able to identify the best available independent directors from the sector is of great importance. We are more concerned to ask what skills a candidate can bring to a Board, than just finding the highest profile names. Business growth is often dependant on the addition of relevant expertise around fund raising, deal structures and other transactions.

Geoff: Scale up or market leading growth can also depend on geographic expansion; whether in terms of where a company is listed, where research or manufacturing is conducted, or where the company’s priority markets are. We have added North American market experience to European companies, and vice versa. Similarly, we have conducted searches to enable established businesses to open up access to new markets and new investors such as in the Asia-Pacific region.

Irene: To achieve Board balance with the expertise needed requires a business to look forward and map its desired growth trajectory. We support Boards with our methodology for assessing needs. Misalignment about needs is a common pitfall in Board searches, so for us, this sort of attention to detail in our preparation is vital.

Bianca: Many of the best Chairman and directors we have seen have a portfolio of several Boards. Some have not been executive for many years. Some clients, however, prefer Board members who are still pretty much full time executives with highly relevant current expertise in operational and strategic leadership, in comparable businesses. Sometimes we need to help delineate the exec/non exec divide and advise on conflict of interest issues. We see Board roles that require engagement in supporting the business, not just attending formal Board meetings. Keeping this engagement within the boundaries of governance best practice is a challenge.

Irene: We concern ourselves with the laws that hold directors personally liable for corporate fault, given their potentially negative impact on Board recruitment, retention and business decision-making. With heightened corporate governance standards for public companies the process of attracting qualified independent Board members is more complicated than before. With intense scrutiny and liability for today’s public company directors, substantial time and effort is required to identify, appoint, balance and develop a qualified Board of independent directors.

Geoff: The changes in corporate governance regulations across all markets have bought additional challenges to remuneration and nomination processes. It is important that we bring relevant experience to the table from the initial assessment phase and throughout the search. Compensation is under particular scrutiny. The role of the remuneration committee is increasingly important, and is notoriously challenging. Finding candidates who are genuinely motivated to lead committees is a key part of our mission.

Geoff: Gender balance on Boards is increasingly seen as an exciting, business enhancing opportunity, not a constraint. Our clients on both sides of the Atlantic are often moving ahead of the relevant legislation and governance codes to balance their Boards. The specialist requirements and increasing scrutiny of remuneration and audit committee work has created new opportunities for the most able candidates. We see more and more women chairing or sitting on these vital Board committees.

Clare: Our specialist focus on the sector enables us to know where to look for talent; especially those with the invaluable commodity of global experience. We have long standing relationships with our candidates as well as with our clients.

Bianca: The reality is that the search for women for Boards is challenging for obvious reasons that have been broadly discussed, but we enjoy tracking and advising women who are keen and able to take on such roles, and who have shown themselves very able in this regard. There may still be some lip service driving the demand for our expertise in this regard, but we are enjoying seeing the balance evolve.

About Coulter Partners

Coulter Partners is a retained executive search consultancy exclusively focussed on life sciences. Founded in 2003, they combine access to their global network of talent with meticulous contextual research to locate and deliver the best candidates available for assignments in every functional area of the life science sector. Their diverse, multi lingual team of Consultants combines PhD level scientific understanding with sector experience. Their clients range from early stage, venture backed businesses to global pharmaceutical companies. They serve clients globally from locations in London (UK), Cambridge (Massachusetts), Morristown (New Jersey), Nyon and Basel (Switzerland), Frankfurt and Berlin (Germany) and Copenhagen (Denmark).

Coulter Partners