Independent Board Guidance
Evaluating Strategy and Identifying Risks
Emerson Lead Independent Director Dr. Clemens A. H. Boersig provides insight on the Board’s important role in governance.
Emerson added Bill Easter as a Board member this year. How will his addition continue to ensure the Board successfully drives strategy?
We serve at our best when we leverage our collective knowledge, which is why Emerson works hard to ensure the Board is a diverse group with deep expertise, not only in their respective industries but also in perspective. We were pleased this year to welcome Bill Easter, retired chairman, president and chief executive officer of DCP Midstream, LLC. He will bring 35 years of industrial leadership and acumen to the Board, as well as his own unique experiences and perspectives.
Emerson has made several acquisitions in the last year. What is the Board’s role in evaluating risks and optimizing and managing the business portfolio?
One of the Board’s roles is to help Emerson review opportunities for investment and manage risk, which is especially important to ensure the company’s business mix is optimized for future growth and cash generation for shareholders. Emerson and the Board are very active in managing the business portfolio; this includes employing a thorough, yearly Emerson Enterprise Risk Process, overseen by the audit committee, to set strategy and identify the most important financial and operational opportunities and threats facing the company. Ultimately, this planning process helps us adapt to short-term changes in the business environment, act on macro trends and identify how an investment would fit into Emerson’s business strategy.
What is the Board’s role in the upcoming CEO succession planning process and in developing and evaluating the next generation of Emerson’s leadership team?
The Board is very involved in CEO succession management, actively managing the evaluation and selection of Emerson’s next chief executive. We also play an ongoing role in nurturing the entire leadership team and ensuring the right people and plans are in place to serve Emerson’s customers and shareholders. Emerson has a deep bench of leaders, and we are intentional when it comes to developing this next generation, meeting with them personally to foster relationships and regularly inviting them to discuss plans with the Board. Ensuring alignment of stakeholders is also something we discuss regularly as a part of leader development and engagement. For example, this year the Board decided to add a relative total shareholder return modifier to Emerson’s long-term incentive structure in order to ensure shareholder return remains top of mind for Emerson’s leaders.
What has made you most proud to serve on Emerson’s Board in 2020?
Emerson’s role and success in supporting essential businesses during the COVID-19 pandemic. It was gratifying to see the company’s adaptability in action as Emerson stepped up to lead its industries and support customers and employees through a difficult time.