Board meetings – how to get the best out of them

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I have sat in numerous board meetings, everything from boards of major corporations to small company boards often just populated by the management of the business.

It’s amazing how poorly some chairpersons run board meetings, some should be re-named bored meetings and others school report time.
Chairpersons who insist on reviewing every operational aspect of the business are either incompetent and do not know the role of a board or clearly have no confidence in the management of the business and the best advice that I can give to a board in this situation is that one or the other have to go; if your chairperson doesn’t understand their role get one that does, or if the chairperson has no confidence in the company management (for good reasons) then they should be replaced.
Worthwhile board meetings have five objectives:

To initially agree a strategy and then to review progress against it and the overall effectiveness of it. In order to do this effectively the board must fully understand:

The key drivers for the business, this might be anything from innovation to cost effectiveness depending on where the business is in its development and how mature the market is that they address.

The strengths, weaknesses, opportunities and threats that are relevant to the business and the market that they operate within.

The changes occurring in the industry and marketplace.

To make sure that company operations are in line with the company strategy.

For example, if a consultancy business had been taking on small projects despite the agreed strategy being only to go after large, complex projects.

To monitor financial performance against plan/budget. This does not mean that the board should review every possible figure and indicator – a board should get a financial report with figures that are on or better than plan in green and those that are below plan in red; the red ones (and only these) are the ones that should attract board interest and questions.

To make sure procedural and compliance issues are properly dealt with. These will include:

Legislation, such as the Companies Acts and health and safety law.

Declaration by directors of possible conflicts of interest.

Codes of conduct (e.g. the rules set up by trade associations).

Compliance with customer requirements and expectations.

To use non-executive directors as a source of alternative approaches to problems and opportunities.

Done well, board meetings help a company to agree a business strategy, set it up successfully and to work to and monitor the effectiveness of that strategy.