Yet board meetings are essential for keeping your finger on the pulse of your business, helping you to establish what is working, and what isn’t. They allow the opportunity to make decisions which can impact hugely upon the present and future of a company, as well as to check in on the health and profitability of your business.
Therefore, in order to get a clearer idea on how to organise a board meeting, this blog shall consider the reasons for holding a meeting, the importance of the board members present, the type of atmosphere, and the planning stage.
Reasons for holding a board meeting
Sometimes a board meeting is necessary for simply helping board members to clarify their roles and responsibilities. Another reason is to perhaps boost board morale. Issues in the workplace can make an environment become stagnant, therefore it is important to get the board members together in an attempt to counteract this. A happy board leads to good decision making!
Idea sharing is a common element of a successful board meeting. Sharing and discussing ideas so that a decision will be made on whether they should be implemented or discarded (or maybe just shelved for later!) is easier in a group environment such as a board meeting.
Regular updates on performance is another good reason to have a board meeting as it allows the development of unity and understanding in a professional environment, keeping all members invested in progress.
And finally, an excellent reason to hold a board meeting is so that all the integral members of a workplace are given the opportunity to get to know each other, both professionally and personally, in order to build a level of understanding and respect.
Who should be on the board?
A board is only as good as its members, and in order to achieve a high-quality board, you will need to recruit members that are balanced and qualified. In regard to balance, consider how many members need to be from management, how many are investors, and how many are independent members.
The investor members should only be from firms that are knowledgeable about the board and are from qualified firms. Also, if a junior investor needs to be present then he/she should perhaps take an observer seat (not voting on issues raised). In terms of management, make sure that if they occupy a seat on the board that they are truly invested in the best interests of the company as being at management level doesn’t guarantee added value! Independent members should help the board evolve, so make sure to do a comprehensive search for the most qualified and vested candidate.
Here’s a problem that many organisers of a board meeting may not realise; board member attention often only lasts around two years before it begins to decline down a slippery slope of inattention. In order to retain engagement with the issues at hand, members often need to be recycled – this understandably could cause some friction in terms of investor members, but it could be manoeuvred with a contract stating that each member only sits on the board for a contracted amount of time. Also, put the board members to work – each one should be aware of what their roles and contributions to the meeting are, whether it’s to do with networking, budget, or recruitment, each member should know what they need to prepare in advance of the meeting.
The role of the Chair is of particular importance in a board meeting, as it is their responsibility to ensure that meeting rules are adhered to and that the meeting is conducted efficiently. They will be the ones putting a motion to the board for a vote as well as summarising the points of a discussion prior to voting. They may also be tasked with ensuring the cohesivity of the board members. As a board might have a lot of big personalities and it’s up to the Chair to manage this, ensuring that there is a respectful atmosphere in terms of idea sharing and decision making. It doesn’t mean that everyone needs to agree all the time, but the manner in which people disagree is important.
This may sound a bit obvious, but the main function of a board member is to participate in board meetings, and the meaning of this may differ between boards. Some boards may be more formal, whereas some prefer a more relaxed and informal atmosphere. But whatever the structure, the best kind of board meeting is one that has a logical flow which keeps the board members engaged and interested. It should elicit a broad range of bankable ideas and information, and at the end of the meeting, the ideal conclusion should leave all members feeling that they have made a valuable (and valued!) contribution.
The atmosphere of the meeting will determine the environment in which it should be held; for example, it would be very strange to hold a highly formal meeting where we address “Madam Chair,” etc. in an informal setting such as a relaxed coffee shop. A boardroom seems fitting for a formal meeting, whereas more social environments such as restaurants or a member’s house or even a simple conference call would be more suitable for a relaxed board.
What type of board meeting do you wish to hold? Board members are regularly involved in quite a range of different meetings, and this may determine the atmosphere that you hope to achieve. Board meetings may take the following forms:
The planning stage
Planning the agenda ahead of time is essential for a successful board meeting. As it’s the list of items that will be discussed the agenda should be made available to all board members ahead of time. This will give them a chance to formulate ideas and solutions beforehand, which will save time during the meeting. If there are further documents such as supporting information and explanations, then consider disseminating them ahead of time too. Sometimes this will involve having to include a timescale for the meeting, such as who will address certain items and how long this is expected to take.
Before the meeting, decide how decisions should be made. Are agreements to be made unanimously, or made by the chair or president of the board after a discussion? If it’s a group decision, is it made anonymously or through a show of hands? Does the meeting require confidentiality? If so then you need to decide how to implement this. Is it something you get verbal agreement for at the start of the meeting, or is a signature required? The number of members is integral to this stage. Odd numbers are preferable because it ensures that a deadlocked board cannot happen.
Another element to consider is whether your board meeting has a quorum. A quorum is the minimum number of board members who need to be present for the board to legally transact business. What this number is needs to be decided in advance of the actual meeting.
The minutes of a board meeting are particularly important as they are the official record of the actions and decision made by the board. They should be taken at every meeting, and a specific person should be delegated to take them. Whether this is a member of the board or not is up to the discretion of the chair. In general, minutes should include basics such as date and time (start and finishing) of the meeting, who the attendees are, as well as absentees (also note when people left the meeting and re-entered), and a summary of the main objectives and decisions made during the meeting. The votes for a decision (the number for and against) may also be disseminated to all board members as soon as possible after the meeting, as this ensures a higher likelihood of action. Remember, it’s a measure of accountability, so minutes cannot be neglected!
With all this information in mind, go forth and get planning! A good board meeting doesn’t happen in a vacuum, but if you give careful consideration to who the members are, the atmosphere, and strategically plan, then there is no reason why you wouldn’t hold a successful and effective meeting. Good luck!