Magazine article New Zealand Management

Is the Board Bored? Most Directors Know That Sinking Feeling When the Courier Delivers the Board Papers on Friday in a Very Large Envelope. the Three Hours Put Aside Will Not Be Enough-All Will Need to Be Read and the Fishing Will Have to Wait

Magazine article New Zealand Management

Is the Board Bored? Most Directors Know That Sinking Feeling When the Courier Delivers the Board Papers on Friday in a Very Large Envelope. the Three Hours Put Aside Will Not Be Enough-All Will Need to Be Read and the Fishing Will Have to Wait

Article excerpt

AFTER wading through the papers, struggling to remain alert, one can only reflect--how much of this did I need to know? Often, not much. And has it assisted me in my role as a director--to set strategy, to monitor and review--and to employ the CEO? Often, not much.

There is danger in the detail--quite apart from the boredom factor and the inclination to skim, thereby missing some important aspect. Too much detail and directors tend to become focused upon the past--and upon operational matters. Valuable board time is consumed, the CEO becomes agitated and time runs out to have productive and visionary conversations. There is too much time spent reflecting on the past and not enough on the future.

So what should be in an agenda? How should a meeting be structured to ensure it is focused and effective because the directors are well advised?

An agenda should contain information to stimulate thinking, to advise decisions, to enable timely monitoring at a high level and finally, to keep the board informed.

Background papers should include the relevant material to provide directors with the knowledge and understanding that they need to make a decision. Reports need to be current and of high quality. Information should be well researched but also succinct and relevant. There should be options and recommendations with clear explanations as to why a particular option has been proposed.

All agendas contain reports for review of company performance and for making sure that satisfactory progress is being made towards goals. Regular reporting is required on the financial position, on key performance indicators (key being the operative word) and on progress with strategies and key projects. This information needs to be open and clear about whether targets are being met or exceeded, or otherwise. Risks need to be identified. Management commentary should explain the variations and comment upon any action being taken or recommended to ensure that targets are met. The board should be able to monitor the organisation and the management of its risks in an effective manner.

However, there should not be an over emphasis upon the past--while learnings can be taken from the past, the focus is on the future.

Of course there are times when there are crucial decisions involving the board, and there is a need for detailed reports. …

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