Boards meet a few times a year. At each board meeting, there are several decisions to make and topics to address. As a result, many boards need to streamline their meetings to fulfill all their obligations within the set time. So how can a board ensure effective meetings?
As a second part of our article series ‘The Strategic board’, we look into how you prepare for the actual meeting, what to think about during the actual meeting, and how you can follow up in a good way – all to ensure effective board meetings.
Why should board meetings be effective?
Board meetings need to be effective for several reasons. Firstly, there is always a time constraint for meetings and simultaneously board members can have other board commitments or engagements. As a result, board members often have tight schedules with little room for flexibility and change.
Secondly, an important part lies in the responsibility to strategically lead the company forward. If board meetings are ineffective, there is a risk that the company will miss potential opportunities, momentum and essentially lose competitive advantage, which can have an effect on the company’s performance.
Lastly, the board and management team sets the tone for the company’s communication. Effective meetings also ensure that the communication and interaction between board members will influence the CEO, management team, and essentially the rest of the organization.
What makes board meetings effective?
- Each meeting should lead to desired outcomes.
- Make decisions on all agenda points.
- The meetings should cover all agenda items.
- All participants understand the meeting processes.
- All members participate in the discussions and contribute.
- There is a clear follow-up from previous meetings.
- There is a follow-up directly after the meetings have ended.
What different factors can promote effective board meetings?
In the next section, we will discuss different aspects that can help promote effective board meetings. These are different factors that can be influenced and improved within a board and that will help you and your board in your strategic work.
Preparation
Considering the often low frequency of meetings, preparation for meetings is key. One starting point is to begin preparations by anchoring the upcoming meeting in the previous one. By following up on previous meetings, there is a system that illustrates how well the board succeeds in its strategic decisions. This means that they get an overview of which strategic decisions are transformed into operational actions.
Another important point is that all leaders should be well-prepared. This is achieved by being familiar with the meeting agenda and having sufficient time to read through any reports and annexes. This also requires that those responsible for the documentation send it out in reasonable time before the meeting so that members have time to familiarize themselves with the content.
The meeting agenda
The meeting agenda is perhaps the item that most people think is the most crucial to an effective meeting – which is partly true. Meeting agendas play a major role in how meetings unfold. A clear agenda helps members to prepare for the meeting. If the agenda follows the same structure, the order of the meeting is also simplified as all members are aware of the different procedures of the meeting. For boards that meet infrequently, a clear structure helps, while boards that meet more frequently benefit from a systematic process.
Different points that are important for a clear agenda:
- If time is available, set aside time to mingle and discuss things that are not relevant to the board meeting itself. That way, the board can ‘warm up’ and focus on the issues without getting lost in the meeting.
- The agenda should include all the items to be discussed during the meeting, with a timetable for each topic.
- The agenda should illustrate the persons responsible for each topic.
- Organize the meeting agenda by relevance and urgency of certain items.
- The agenda should be anchored in the topics decided for the board’s annual plan (discussed in a later section).
Participation
Members need to be actively participating in order to make board meetings productive. On the one hand, this means clear and structured meeting management by the chairperson. It requires him/her to possess meeting management skills. Among other things, the Chair should be a skilled communicator, able to moderate the meeting. This includes managing the communication climate, identifying conflicts, and fairly delegating the word. The chairperson should also be open to feedback.
On the other hand, the participation of board members means that they are aware of the business and follow its development and processes. Increased understanding of the organization also increases participation in board meetings; informed board members make better strategic decisions and find it easier to participate in meeting discussions.
To increase engagement and understanding of the organization, board members can also participate in management team meetings. This will increase understanding of how the board’s strategic decisions are translated into operational actions, thus reducing the gap between the board and management. It also increases the understanding of the organization as a whole.
Decision-making
You should base decision-making on discussion, which is closely linked to the previous point, participation. The discussion during the meeting should focus on the main topics relevant to the success and growth of the company. Board members should have the opportunity to express their opinions and thoughts on each topic on the agenda, and all views should be considered. A reasonable guideline for the board meeting’s discussion is to talk 3/4 about the future of the company, and anchor 1/4 of the previous business and other items.
An effective board meeting should result in concrete decisions that move the company forward. Make decisions by vote or consensus. It is also important that you document all decisions in the meeting minutes, and that you create an action list with possible items and different responsibilities.
Full-year perspective
To link the work of the board, it is strategic to introduce a full-year planning perspective. This gives a clear overview of the actions and activities that the board has during the year. By introducing annual planning, you as a board will get clarity on which focus areas you are addressing during specific meetings, thus ensuring that you work forward with a plan without getting stuck in discussions or specific topics. Different focus areas can be governance, GDPR, budget, risk analysis, board evaluation, sustainability, and review of the annual report to name a few.
How can we help?
Governance@work helps CEOs, boards, and management teams gain control over corporate governance. Through a digital situation analysis, you get an overview of your areas of improvement and potential. The format is fully digital and can easily ensure a consistent process over time. Read more about our different assessments and how they can help you, or contact us if you want to know more.