As the axiom goes, serving as a director is a part-time job with full-time responsibilities. That principle is particularly applicable to directors of newly public companies. And it’s even more relevant for directors of companies in the fast-developing cannabis industry.
On the heels of several states legalizing the sale of cannabis in recent years, a thriving yet complex new industry has emerged. Investors’ interest is mounting but so, too, is their collective focus on cannabis companies able to demonstrate credibility in an emerging space with an evolving regulatory landscape.
Against that backdrop, cannabis companies with boards that boast strong corporate governance practices and the diverse skills necessary to oversee dynamic operations in a complex operating environment give investors comfort and added reason to invest.
MedMen is a case in point. Since going public, the leading U.S. cannabis company has focused on building a board with governance expertise and wide-ranging skill sets. Its determination to get things right on these fronts played a big role in my decision to join MedMen’s board. The company strives to implement best practices across every aspect of its operations. The board is in its early days, but MedMen is committed to ensuring its directors amplify this company rule.
As a director of MedMen, I am one of eight board members, five of whom are independent. Collectively, our board has expertise in cannabis, consumer goods, luxury brands, retail, capital markets, legal, finance and tax, among others. We are tasked to understand the cannabis industry, and to both learn and address what matters most to our investors and other stakeholders.
In the cannabis sector, directors must proactively seek out the information they need to fully understand the changing landscape and the competitive dynamics that impact the companies they govern. They also must partner closely with MedMen’s management team to ensure that the company’s strategic plans are aligned with the goal of creating long-term value for shareholders. In these ways, a board can prove a genuine asset that complements the strategic planning of management, creating a competitive advantage.
Stacey Hallerman was vice president, chief legal counsel and corporate secretary at Richemont North America, part of the global luxury conglomarate that owns iconic brands such as Cartier, Chloe, Van Cleef & Arpels and Montblanc. She was also senior corporate counsel at Pfizer.