Where Are the Directors Now?
A Principal’s Perspective — Michael Hartmann, C.Dir.
2023 marks the 20-year anniversary of The Directors College, Chartered Director program (C.Dir.), and the Institute of Corporate Directors (ICD), Director Education program (DEP). As the Principal of The College, and as someone closely involved in the early start-up of the DEP, I am reflecting on how these two bold initiatives have helped shape Canada’s corporate governance landscape. To better understand this question, I plan to speak with the program founders, past and present program faculty, and some of the 10,000 plus alumni who now proudly call themselves C.Dir. and ICD.D accredited graduates.
A Founder’s Perspective
2003 was a significant year for corporate governance education in Canada: The Directors College and the Institute of Corporate Directors each launched their own director education program in response to a series of related events.
The public collapse of Enron in 2001 due to board negligence had widespread consequences, including the U.S. government passing the Sarbanes-Oxley Act to reduce corporate fraud and increase investor protections. In the wake of the Enron scandal, Canadian corporate leaders wanted a clear solution to avoid the fallout of an Enron-like scandal north of the border. Eventually, the answer became clear; a push for updated best practice guidelines, and new regulatory safeguards, needed to be accompanied by professional board and director development.
Let’s briefly take a look at how Canada’s two leading governance programs started and the collective impact they have had over the past two decades.
The Directors College, Chartered Director Program
In 1994, in response to a series of earlier corporate fiascos, Peter Dey published a report entitled “Where Are The Directors In a World Crisis”; it outlined 14 best practice guidelines for corporate boards in Canada. Following the report, The Conference Board of Canada hired David and Debra Brown to start a corporate governance research program to help corporations and public sector enterprises apply the guidelines listed in the Dey report.
Seven years later (following yet another series of high-profile business scandals), The Conference Board asked the Browns for proposals on how they could improve board governance in Canada; his top suggestion was a director’s education certification course. “They loved it,” David recalls, “They thought it was a great idea, so The Conference Board’s board approved it and asked us to find a business school to partner with.”
After an extensive search, they found the ideal partner in McMaster University: a university known for problem-based learning, which was similarly interested in running a governance course. Working in close collaboration, McMaster and The Conference Board created The Directors College and its flagship Chartered Directors program (C.Dir.) dedicated to establishing a national pool of qualified board members.
In the fall of 2003, The College launched its pilot C.Dir. program attracting 26 eager participants; that 1st cohort was largely comprised of institutional investors, individual investors, and both large and small business owners. Brown recalls being impressed by the inaugural class, “They were there because they wanted to learn; they wanted to get better,” Brown says; “they wanted good corporate governance for the companies they invested in and the businesses they founded and led.”
From there, the C.Dir. program grew rapidly through word of mouth. Graduates would recommend it to their board colleagues, many of whom would reach out to enroll and soon one annual program offering became 2 then 3, and then 4. It also helped that the two partner institutions saw the C.Dir. as a way to promote their shared philosophy of principle-based governance with a strong problem-based focus. This multi-module program culminated in an intense 3-day case study that used professional actors to help simulate a “year in the life” of a fictitious company struggling with a list of complex governance challenges. This immersive exercise was designed to help participants transfer the principles and behaviors learned in the classroom back to the boardroom.
The ICD/Rotman, Directors Education Program
A series of high-profile governance meltdowns south of the border galvanized some of Canada’s most respected governance leaders to come together to find a way to dramatically improve board performance and they saw the Institute of Corporate Directors (ICD), as a potential launching point. The goal was clear — establish a formal director’s education program — but the ICD at the time was still little more than a start-up entity with relatively few members, virtually no office space, and little financing. They needed someone to get it up and going, so Beverly Topping was brought in as president.
Topping, founder of Today’s Parent (Canada’s #1 parenting magazine), was a highly successful entrepreneur with experience serving on boards. Having worked on several boards herself, she saw a clear need for an education program to drive change, and as an entrepreneur, she needed the ICD to launch this bold initiative with passion and urgency. “You can always fix it, or take it apart,” Topping said “but if you are going to build something, do it without the bureaucracy slowing you down”.
There were preliminary talks with various universities, but the Rotman School of Management soon became Topping’s preferred choice. The ICD struck a deal with Rotman, whereby the Institute would be the marketing engine while Rotman would design and deliver the curriculum in a series of 4x4 day modules. Due in part to the School’s central Toronto location, and its reputation as a corporate finance thought leader, the ICD/Rotman program garnered a lot of interest from corporate Canada, and its early cohorts reflected this interest — these programs were comprised of the who’s who of Bay Street firms.
Topping recalls a palpable feeling of excitement when reflecting on the DEP’s early years, “There was a sense that we were going to help create a more effective governance model for corporations, and make a difference!”
The Collective Impact (2002–2023)
Today, The Directors College and the ICD can claim well over 10,000 program graduates residing in every corner of the country and representing every type of organization. Through their graduates, they have injected a common language into Canada’s boardrooms and a shared way of thinking that makes it easier for directors to work together in the interest of their stakeholders. They have also created new pathways for promoting greater board diversity by helping board newcomers grow their confidence and establish and expand their professional networks.
The College and the ICD have help set a national standard for effective board governance, with ICD.D and C.Dir. program designations becoming an expectation for board membership — Beverly Topping notes: “The bar has been raised significantly since 2003. We have professionalized the corporate director. It is no longer just a task. It is now a profession.”
For all the contributions that The College and ICD programs have made to “raising the bar,” we find ourselves today confronting a mix of highly complex issues that severely challenge a status quo mindset. I look forward to sharing my upcoming conversations with fellow educators and program alum on what lessons have been learned and successfully applied over the past 20 years and what new and possibly radical governance approaches need to be taught and tested as we move forward.
