Tuesday, January 7, 2014

Observations on Good Board Practices

Happy New Year to all of our entreVIEW readers. Here’s hoping that 2014 will be your best and most prosperous year yet!

This is one of my favorite times of the year (if you don’t factor in our current weather). After all, ‘tis the season for lots of wonderful get togethers with family, friends and co-workers. ‘Tis also the season, apparently, for Board meetings. Over the last few weeks, I have attended several Board meetings and have a few more approaching in the next few weeks. After reflecting on all of these meetings, and preparing for the ones to come in the near future, I thought I would share a few simple observations of Boards that operate well.

I recommend regular meetings of the Board, if at all possible. Boards don’t need to meet monthly, but they should try to meet quarterly. The discipline of preparing for Board meetings, even though it can take time, is time usually well spent for management and Board members alike. For management, it allows them to reflect on key accomplishments during the period since the last Board meeting and, more importantly, forces them to focus on what they would like to accomplish during the period before the next meeting and beyond.  This permits management to be thoughtful and realistic about what has been accomplished, where they are, and where they are going. Regular Board meetings also help the Board fulfill their fiduciary obligations by getting regular updates from management.

It is a good idea to schedule regular Board meetings on the same day and at the same time each month or quarter. If you try to coordinate a date and time that will work for everyone’s calendars for each separate meeting, you will have to wait a long time and spend hours and hours scheduling and rescheduling. Everybody’s calendars are too packed to try and coordinate a day and time that works for everyone. A better approach, I think, is to set your meeting dates and times well in advance and on the same day and time. For example, if you have regular quarterly meetings, have them all on the same day of the quarter (e.g., at 10:00 am on the last Tuesday of the quarter). It is inevitable that there will be conflicts on one or more of those future dates but, by setting the meetings in advance, you allow people the opportunity to try and plan the rest of their schedule around the regular Board meetings.

Finally, try to have at least one meeting a year in person. It is easier to do, of course, when all Board members are located near each other. But even, and perhaps especially so, for Boards that have members scattered across the country (or world), regular in-person meetings (yearly, bi-annually, quarterly, whatever) are a good use of company time and resources. In-person meetings are good for Board chemistry and allow Board members to become more engaged and committed to the company’s success. One Board I work with has regularly scheduled monthly meetings. The first two meetings of each quarter are held by teleconference, and the last meeting of each quarter is held in person. The Board has members in a few different states, but they all make an effort to attend the quarterly meetings in person, which I think has allowed them to become more involved with the company.

Some of these suggestions probably seem obvious to well-functioning Boards. However, if your Board is not currently having regular meetings, at regularly scheduled times, with at least one in-person meeting, you may want to consider changing that practice to relieve some administrative hassle, as well as to permit your Board to become more engaged and involved in your company’s success. Consider it a New Year’s resolution for a more successful Board in 2014!

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