New Study: Sustainability starts with board nomination committees

DecideAct manager and Ph.D. fellow Hildur Magnúsdóttir has just published a new scientific study that provides insights into the importance of profiling nomination committee members for companies that want to put sustainability at the top of their agenda. According to the study, companies must be more aware of the role of the board and nomination committees in promoting sustainable practices in the organization.

In parallel with her job as Manager for Sales and Customer Success at DecideAct in Iceland, Hildur Magnúsdóttir is a Ph.D. fellow at the University of Iceland, School of Business. Now she has published her first scientific article on MDPI, a leading open-access publisher in Switzerland together with her research colleagues Dr. Audur Arna Arnardottir and Dr. Throstur Olaf Sigurjónsson, also the supervisor of the Ph.D. thesis.

The article starts from the premise that sustainability is a critical issue for businesses today, and that corporate boards and nomination committees (NCs) play a vital role in promoting sustainable practices within organizations. The composition of NCs can determine whether the necessary knowledge and skills reside within a board to deal with sustainability and good corporate governance. The research aims to provide insights into stakeholders’ perspectives on what matters when profiling nomination committees’ members.

The literature on NCs is underdeveloped. Magnúsdóttir, Arnardottir and Sigurjónsson’s research importantly addresses the issue by interviewing 13 individuals who are either shareholders or board members of listed companies, or members of NCs. Additionally, 138 shareholders, board members, and NC members from the 300 largest companies in Iceland responded to a questionnaire.

The results show that stakeholders believe deciding upon an NC’s composition is important before electing its members. NC members should have either management or board membership experience. Diversity within the committees is also seen to be important, as it can influence diversity and inclusion overall at the board level.

“These research results provide important insights and understanding for shareholders and boards of directors when composing nomination committees,” the authors say. “Sustainability starts with the composition of board nomination committees, which in many ways determine whether the board will represent the knowledge and skills needed to promote sustainability and good governance.”

Magnúsdóttir’s doctoral work explores corporate governance and nomination committees. She holds an MSc degree in strategic management from the University of Iceland (2018–2020) and a BSc in business administration from Reykjavik University (2006–2008). In addition to her previously published research on boards of directors and nomination committees, she has also cooperated with agencies such as the Icelandic Chamber of Commerce, e.g., in providing guidelines for nomination committees.

The full survey with questions and results can be found here: The full survey with questions and results can be found here: https://www.mdpi.com/2071-1050/15/6/5595

 DecideAct’s company webpage: https://www.decideact.net