This is the question that hangs in the air with the debut of our latest list, the Fortune Modern Board 25, a ranking of the most innovative corporate boards in the S&P 500, using board effectiveness data from the Diligent Institute, the research arm of the global corporate-governance software company Diligent, along with ESG data from Refinitiv.

My colleague, Aman Kidwai, who writes the Modern Board newsletter (sign up here) breaks it down this way.

“The best way for the public to evaluate a corporate board is by looking at who is in the room and what their previous experiences and current affiliations are. The diversity, independence, and expertise of board members are all big predictors of a company’s performance,” he says. “For example, Microsoft, which finished in the top spot, has eight out of 12 board members that are women or people of color, including a former US secretary of commerce and multiple high-profile CEOs.”

Rounding out the top five are Hewlett Packard Enterprise, Walgreens Boots Alliance, Intel, and 3M.

Alan Murray and I recently caught up with Brian Stafford, the CEO of Diligent, on our Leadership Next podcast. Diligent is a software company that provides governance tools to some 750,000 board leaders in over 25,000 companies, but it’s also become a board member education hub. He made it immediately clear that corporate boards have changed forever. It’s no longer a cushy gig requiring four no-fuss meetings a year: “The reality is that the spectrum of what a company is now responsible for, and what leaders are responsible for, means that the role of the board has changed materially.”

The list facing corporate leadership is long. It’s not just internal diversity—it’s taking a stand on racial justice, activist investors, cybersecurity risks, social media, and public demands for accountability. Climate change and sustainability. Pandemic and politics. A new focus on stakeholders. Changing regulatory requirements. A technology revolution that’s bringing new threats and opportunities. All of these—oh, and the threat of a new world war—mean that corporate leaders are leading out loud in entirely new ways.

Navigating that is the job of a modern board.

Smart CEOs use boards as an extension of their collective intelligence, bridging expertise gaps and tapping them to address pressing issues as they arise.

“Boards are taking on a more active role in corporate affairs, weighing in more often on matters like succession, diversity, recruiting, and environmental impact. And while overseeing and advising a company’s executive tier remains priority No. 1, boards are elevating purpose to be in line with profit in an effort to future-proof their companies,” writes Kidwai in the opening essay to the list.

But as the board room changes, power dynamics do, too.

This development strikes me as a powerful blow to the “great man” theory of leadership, which should have long been abandoned by now. You know who I mean: The super-pumped company founder who builds a unicorn on the strength of his personality, or the brooding genius in the corner office who commands his way into case studies and onto business magazine covers. Those stories were never actually true, but now they’ve outlived their even limited usefulness.

Now, the talent pool for future board members has just opened wide. And that alone means a business transformation.

“The fact of the world, particularly the structures in the world…has been designed and perfected around a white male ideal,” former Xerox CEO and current board director Ursula Burns told me in a candid interview last year. (Traditionally, a “great man” named John who has delegated home duties to a stay-at-home spouse.)

That enduring image creates its own bubble.

“These organizations are started by white men,” she said last year of the thousands of privately held, venture-backed companies with nearly all-white boards. “They start the company with their friends and their family. Their friends and family look exactly like them, right?”

Burns is knee-deep in her own board diversity effort. The Board Diversity Action Alliance was launched in September 2020, along with Gabrielle Sulzberger, Teneo, the Ford Foundation, and the Executive Leadership Council, for the specific purpose of increasing Black representation on boards. It’s not just about guiding a company. It’s also about re-shaping the world that companies have made in their own self-affirming image. “This is the problem we have to solve,” says Burns.

Now that companies are ready for new expertise, are you ready to join a modern board? What’s your see-around-corners strength? Send me a short Twitter-length pitch for yourself via email—don’t be shy, sing your specific praises— and I’ll include it in reader mail on Friday. Subject line: Modern Board Ready

Ellen McGirt
@ellmcgirt
Ellen.McGirt@fortune.com

This edition of raceAhead was edited by Wandy Felicita Ortiz.

On point: AAPI hate

It’s been a little over a year since Congress held a hearing on the violence experienced by Asian Americans, and it seems little is happening to address the crisis. According to the Center for the Study of Hate and Extremism, anti-AAPI hate crimes increased by 339% in 2021. Into the leadership gap, an array of activists are continuing to work and collect vital data. The most recent report from Stop Asian Hate is sobering: Most of the violent attacks happen in public spaces — streets and businesses — and at 62%, most reports of attacks are from women.

Do your AAPI employees feel safe coming back to work? Once again, Mita Mallick asks the question that all DEI leaders should be asking their employees. But in the case of Asian American employees, it’s vital to ask the question specifically, and really listen to the answers. Her three steps should be standard for any inclusive workplace – which includes making sure you explore specific safety options, if necessary, and insist (emphasis, mine) on offering bystander intervention training. Checking in really matters, though. One woman shared a story of being afraid to head to her favorite Chinatown restaurant for lunch. “I am angry and scared. I am sure if I asked a colleague to walk with me, they would. I haven’t felt comfortable bringing this up to anyone on my team at work yet. And quite frankly, no one has checked in with me to see how I am doing. The silence hurts.”
HBR

It's time to disaggregate federally collected data by race and ethnicity We covered how aggregated data hides racial inequities buried in the tax code, but the good folks at Robert Woods Johnson Foundation make the case that lumped-together data sets are hiding massive health (and in the example of AAPI populations, I would argue crime and safety) inequities across the country. There is a spate of legislation that would mandate data disaggregation — get up to speed and prepare to advocate below.
Health Affairs

Asian elders may be suffering  According to a new study in the Journal of the American Board of Family Medicine, Asian elders are less happy and get less social support than other their peers in other races. The data was derived from the 2018 California Health Interview Survey and includes responses from some 8,200 individuals over 64 years old, of Chinese, Korean, Filipino or Vietnamese descent.“In general, mental health needs increase as people get older,” DJ Ida, executive director of the National Asian American Pacific Islander Mental Health Association told NBC News. “But our health care facilities are not adequate for the needs of the Asian community.”
NBC News

Parting words

"The racial trauma Asian colleagues have been intensely experiencing during this pandemic is not exaggerated or made up; it is real. Over and over again, we are seeing people who look like us being specifically targeted, repeatedly punched, kicked, and beaten. And shoved in front of oncoming trains and murdered. When we leave our homes, many of us are on high alert, constantly checking our surroundings, questioning what routes we are taking, and living in a perpetual state of anxiety and fear."

— Lan Phan, CEO and founder of community of SEVEN, a leadership development program

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