Elon Musk’s decision not to join the board of Twitter is a good one.
He already has huge commitments to the companies he founded, in industries (electric vehicles, space exploration) that don’t clearly relate to Twitter’s business, and wouldn’t necessarily be the best fit for its business model and strategies.
In fact, his potential board appointment highlights a longstanding problem with company leadership: Firms should stop picking from a tiny pool of people who already have massive work commitments, and instead choose members with the time and energy to help steer their businesses thoughtfully. Doing so would also help combat a second, intransigent problem: Most people on boards are still white men.
On April 4 Elon Musk—whose tweets have moved markets and caused controversy in the past—announced the purchase of a 9.2% stake in Twitter for around $3 billion, making him its single biggest shareholder. The same day, Twitter appointed him to its 11-strong board, effective April 9. But the morning his new role was scheduled to start, Twitter CEO Parag Agrawal wrote on April 10, Musk changed his mind. “I believe this is for the best,” Agrawal said.
Musk may have decided he didn’t want his ownership of Twitter limited to the 14.9% stipulated by the board-seat arrangement. He may have preferred to keep lobbing advice from the sidelines.
He may also have realized he was too busy. One of the issues with the top ranks of corporate governance is that it draws so much from the same pool of already-overstretched people. This is a problem for several reasons:
- Work for those individuals becomes almost impossibly demanding. If the jobs at the top of industries entail such vast work commitments they will always remain more available to those who already have a lot of time: People without caring responsibilities, for example. That workaholic persona will remain the role model at all levels of the firm, making any attempt at better balance—which workers say they want, and managers profess to encourage—harder to achieve.
- There is already a pipeline and culture problem that predominantly assists white men. If one of the criteria for board appointment is that a person is already a CEO or has another C-suite role, the pool of possible appointees will remain mostly white, and mostly male. It will continue to ignore people with deep, precise, applicable skills who work in areas that don’t look so conventionally impressive on a CV. More than 70% of board seats in the Fortune 500 are held by men, and more than 80% by white people, according to Deloitte.
- Giving board seats to CEOs and their equivalent exposes a narrow idea of what skills a person needs to help run a company (essentially limiting it to “already runs a company.”) There is plenty of talk about skills like compassion and humanity in other levels of business. These shouldn’t be absent from boards, whose members should have time meaningfully to do the job. Finding such appointees would make for better-run companies.