“In the boardroom today, we need to go beyond thinking out-of-the-box, we must actually remove the box!” emphasises Johannes Luef, a recent certified director from INSEAD, explaining, “board members are often constrained by their own minds and experience, but we need to believe nothing is impossible.”

Austrian born, 64-year old Johannes Luef has lived and worked in Denmark since 1974 and has had a long career and in-depth experience with managing and supervising complex large IT projects and solutions. This former CEO of VP Securities A/S for 14 years, has also served on several boards: ECSDA (European Central Securities Depositories Association), Link Up Markets (Direct Cross-Border Access), VP Services and VP LUX; and is one of the relatively few Austrian-Danes who can call himself an international professional director.

“I am now entering a career path as Independent Non-Executive Director and strategic advisor and consultant within the financial industry, CSD's, Issuer Services, CCP's and EXCHANGES and the world of ERP industry,” Mr. Luef envisions.

His recent training at INSEAD’s corporate governance programme for international directors changed Mr. Luef’s paradigm of the board’s crucial role and duties in organisations, especially that of the chairman and independent directors. Reflecting back on his own experiences which were further decoded and clarified through the training, Johannes advises strongly, “The chairman should not be controlling, but in fact be a skilled listener and one who is able to draw out the group wisdom of the board. Also, one of his or her most important tasks is to help bring together and build the right and diverse team of directors for the company.”

He also shares an interesting experience of a chairman who used to record all board meetings and afterwards reviewed the video to reflect on how the time could have been used better, if the supporting material useful, etc., even bringing in the CEO if necessary.

Board Process Simulation and 360 Degree

Interestingly, as part of the INSEAD programme, Mr Luef had to go through a board process simulation, during which he was given the role of chairman, of a disguised real company, where he had to lead a group of his peers in a board room discussion to decide on a merger. “I was quite nervous and at the end of the meeting was convinced that I’d actually flopped as chairman. But my fellow students, all talented and experienced directors from around the world, conveyed that it was a great meeting because they were able to speak their minds freely and we had lots of diverse discussions. Though we did not conclude on everything, the comprehension of the board was that it was a good meeting.”

Carl Jung once said, “Meeting oneself is probably one of the most unpleasant meetings of your life.” The 360 degree survey and coaching that is part of the IDP, involves learning more about oneself from your peer group. Mr Luef explains, “It was a tight session with five of us in a group coaching session, so not only did I learn from their experiences, I also received some good insights about myself such as the importance of listening well to understand conflicts better, to learn how to move from the habits of a CEO who is very operational focused to being a director, and using those previous experiences and skills to be a mentor and coach.”

Other key takeaways from the training were the following:

• Besides overseeing the company and being able to see the big picture, the board should be more self-reflective, be less involved in operational activities and in fact coach the CEO and other executives in a proactive manner.
• Unfortunately, boards are not involved enough in strategizing for the company, and tend to leave it to the management. This needs to change and boards must understand that strategy work is its responsibility, in close collaboration with the CEO and senior management.
• Independent directors are vital for a board, but they must bring in their own experiences, not hesitate in asking questions and making proposals, and in fact they should demand rationale explanations if their suggestions are not accepted.
• Generally for directors to become more effective, they need to spend time in self-assessment, be more open-minded, fair, strategic and global thinkers. And evaluate every board meeting, asking how we could have done better.
• On the interplay between the board and management, the former should support fast and efficient decision making for the CEO, thus contributing to high performance, and committees and task forces should help focus on specific are as of greater importance.

International Class

Though Mr Luef commends the module on cultural differences that explains how understanding is the key, and confesses that there are similar courses available in Denmark, it is the real international experience in the classroom in Fontainebleau that makes all the difference. “The 41 fellow students from 19 different countries, including United States, Canada, Australia and Nations in the Middle East, Africa and the rest of Europe, bring in the diversity of thoughts that is absolutely irreplaceable. It is something else, when you are together with so many different nationalities - each person bringing their own cultural understanding of a situation which takes the training to many dimensions, and though there may be conflicting opinions, somehow we manage to come up with the answers.”

His own journey of becoming more ‘international-minded’ started with his move from Austria, which is a more formal command-control style of leadership, to Denmark, a more bottom-up and informal culture. Now understanding both cultures well, has led to Luef being a consultant on project by the Austrian government to make Denmark more appealing for business for Austrian suppliers, who are traditionally used to dealing with Germany and England, and assume Denmark is the same as the rest of the Nordic countries. Furthermore, his experiences working with Americans, Europeans and Mexicans on various boards have expanded his cultural understanding and adaptability.

Insightful Leaders

Talking about the importance of industry knowledge for a director, Mr Luef has a counterintuitive perspective. “It is assumed to be crucial, and in my process to acquire board membership, I’m often confronted by this, but my personal opinion is that this is not that important. I have been in various industries and found it quite easy, because when it comes to the big questions, there is a lot of commonality in how you make decisions and strategize; the industries are not that different. In fact, some of the best chairmen that I’ve witnessed do not come from the industry of the companies that they are successful in. The insightful leader today needs to have the deeper tools of soft power, ethics, fairness, negotiation skills, etc. There is more awareness of business’ role in society and we need to look at things that we have not done before.”

Interested in INSEAD's International Directors Programme? Learn more.