Step 3 – Make meetings count

Nine Steps to Effective Governance

Review the structure and content of the board meeting

A board’s productivity and effectiveness are based on its understanding and implementation of theory and practice. These elements come together in the boardroom.

A board meeting should be stimulating, challenging and, ultimately, satisfying

It should focus on two core aspects:

The desired strategic achievements and understanding of the environment and issues impacting on the organisation’s ability to achieve its goals
The risk factors that could impede or disrupt the organisation’s ability to achieve the desired results.

Dialogue is at the heart of a board meeting

The quality of interchange between directors is the key determinant of the success of the meeting. This will include:

a spirit of collaborative exploration of key issues
a contest of ideas but not of personalities
constructive and respectful inquiry of others about their views
use of open, non-judgemental questions
a demand for rigour in analysis and evidence-based decision making.

It is acceptable and even desirable to have a:

creative tension in the room
level of agreeable disagreement.

Board meeting basics

Boards shouldn’t try to steer the organisation by looking in the rear vision mirror

A board has no ability to influence what has already happened. Boards typically get ‘bogged down’ in shorter-term, day-to-day operational and management matters at the expense of paying adequate attention to governance-level policy and strategic issues with longer-term significance.

The board should aim to spend more of its time on matters that are important but not urgent, for example, environmental monitoring, strategic thinking, policymaking, relationship building, risk characterisation, performance review and development.

Board members are expected to attend all meetings and events when the board is required. This is a basic requirement of directorship and should be spelled out in the board’s Code of Conduct.

Agendas

The development of board agendas should not be delegated to the chief executive. The board meeting is a governance forum, not a management one.

Boards benefit from an agenda that tackles strategic issues early in the meeting, leaving monitoring and other compliance-type topics until later.

A strong focus on important issues is achieved by:

planning meetings effectively and managing them well
producing appropriate, concise board papers that get to the heart of the matters on which the board must deliberate
having board committees or task forces explore the issues ahead of the meeting, help gather relevant information and frame issues
encouraging each board member to be well prepared
allowing board members to ask probing questions
encouraging self-discipline and concentration among meeting participants
having proactive policy that prevents the board from needing to consider everything in an ad hoc manner.

Common pitfalls in meeting content include:

revisiting earlier decisions through the minutes or matters arising
tabling unnecessary correspondence
introducing staff reports that are not placed in a governance context, and purposeless ‘information backgrounders’
seeking permission (flawed delegation)
presenting unnecessary financial reports and approvals
allowing presentations that are not relevant to governance.

The chair’s role is to:

prepare well, screen issues and plan the agenda
be clear about the key matters the board must address during the meeting
keep discussion on topic and focused on governance issues
encourage participation from all directors
manage the time of the meeting
ensure the discussion is timely, fair, orderly and thorough
manage conflict and summarise accomplishments.

The chief executive should provide timely reports on:

financial performance and projections
achievement of, or progress towards, strategic outcomes
information about changes in the operating environment as these affect the results sought
any change in the major areas of risk
information about any impact of the board’s policies on the chief executive’s ability to do their job.

The board develops a policy that makes it clear to the chief executive what should be reported.

Board discussion should be about governance issues not management matters; therefore the chief executive’s role is to be the board’s primary consultant.

Committees

The common and useful committees that help a board do its work are:

Audit and risk management
Chief executive employment
Governance-board membership and succession.

All board committees should have:

clear terms of reference defining their roles
expected outputs
boundaries of authority
reporting requirements
membership particulars
a sunset clause, if appropriate, limiting their lifespan (this generally applies to project-specific committees).

Board committees shouldn’t get involved in tasks that are the domain of the chief executive or the staff.