The role of the PE Chair in developing a high-performance culture

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Our 42 years of investing in UK growth businesses has shown us that the foundation of any successful business is its people. One of our primary objectives at ECI is supporting senior management teams in developing a high-performance culture.

As part of this focus on talent and culture ECI supports our portfolio companies in the recruitment of an experienced Chair as early as possible. The right Chairperson can be an extremely valuable component to any executive team. A good Chair is usually independent of the PE firm and therefore more closely aligned with the management team. They will typically invest alongside management to strengthen that alignment and buy-in.

When looking for the right Chair to recruit onto the board, there are several important qualities to look for. We have highlighted four below:

1. The Chair should be an effective communicator.

2. They will have previous experience of running businesses and should be prepared to listen and act as a sounding board or mentor to the CEO and the senior executive team.

3. An exceptional Chair will be able to bring the best out of their senior management team and be able to ensure all the key personnel contribute to the decision making and strategic direction of the company.

4. The ability to listen and debate and then influence without dominating are key strengths.

Woman working on laptop at table

ECI has a large network of candidates who are seasoned former CEOs many of whom will have had direct relevant private equity experience. We work in partnership with our management teams to select the right Chair based on the desired skill set. This will usually be different for each business we partner with and may well involve specific industry expertise or relevant international capability.

Whilst the CEO is at the helm and driving the agenda, the Chair is the most important figure behind the scenes acting as an intermediary between management and the private equity firm but also sharing their past-experience. Experienced Chairpersons can quickly identify opportunities and potential risks facing their organisation.

A great Chairperson can be integral to the long-term success of a portfolio company and plays an important role in influencing the decision-making process internally as well as communicating externally with all stakeholders. At ECI, we consider the Chairperson to be a vital member of the team and we work hard to find the right blend of experience and skills to support the next phase of growth.

“I have worked with ECI as Chairman on several of their past investments including Citation, Clarity Blue, and WCI Group, during which time I have found the experience of working with both the management and ECI teams tremendously rewarding. In my experience the Chairman’s role can be particularly important not only in acting as a sounding board for the CEO – providing guidance – but also acting as a bridge between the PE firm and the management team.” Andy Vaughan, Chairman of Make It Cheaper and MThree Consulting.