Best practices for board meetings take on more of a one-size-fits-most than a one-size-fits-all approach. Most often, the appointed board chair facilitates meetings, but nearly anyone can do the job. The Corporate Secretary usually takes the lead on preparing for board meetings, but the General Counsel, the Chief Financial Officer or a member of their staff can take on all or most of the meeting preparations. Preparing for board meetings is a time-consuming job where corporate secretaries may need to assemble as many as 100 board books. Today’s boards can cut down drastically on this task by using board management software programs.
Best Practices for Planning and Preparing Board Meetings
Boards need to carve out time for planning meeting schedules as well as for planning board meetings. To make meeting planning predictable, boards usually plan their first meeting date at the beginning of their fiscal year. Most boards meet quarterly, but some meet bi-monthly.
The Corporate Secretary or other meeting planner begins planning the agenda at least a month beforehand. It’s a good idea to schedule time for the meeting, and also to schedule time for planning the meeting. Two weeks before the meeting is the time for the Corporate Secretary to start drafting the agenda and putting the board book together. The Corporate Secretary should distribute board books about a week before the meeting.
Another important date to schedule is the annual date for setting bonus compensation for officers and employees. This usually occurs during the last meeting of the fiscal year or during the first meeting of the following fiscal year.
Collaborate With Board Chair
Board chairs usually find their own rhythm with the agenda preparer. Board chairs and agenda preparers who are new to working together should discuss how involved the board chair wants to be in developing and approving the agenda. Some board chairs like to be more hands-on than others. Board chairs should communicate with the agenda preparer about whether they need details or whether they take more of an overview approach to the agenda. They also need to discuss an agreed-upon timeframe for distributing board books.
Best Practices for Creating an Agenda
Agendas have a standard format that boards can customize according to their needs. Agendas should be concise and fit onto one page. Agenda preparers should keep agenda items to a minimum. It helps to streamline meetings if boards specify the action that the board needs to take after each agenda item, such as discussion, decision, information, etc. For heavily loaded agendas, the board chair and the agenda preparer may assign a time for discussing each topic to keep the meeting moving along.
Executive Committee Meetings
Public boards are required to have executive sessions. Many boards have executive committees, which typically operate as steering committees for the full board. Executive committees may meet a week or so before full board meetings or they may meet at some point during regular board meetings. Best practices for executive session suggest that executive committee meetings should dismiss the CEO for some part of the meeting, so the members feel free to discuss some issues without management being present. Alternatively, executive committees may have some meetings with the CEO present and some meetings without the CEO present.
Common Agenda Items Related to Governance
Over time, boards have developed a broad template of an agenda. Boards can add additional agenda items at any place in the agenda. Here is a standard listing of common agenda items in the order that most boards list them:
- Roll call
- Approval of previous board meeting minutes
- Committee reports: executive, compensation, audit, nominating, finance, etc.
- Reports from ad hoc committees
- Department and program updates
- Financial reports
- Review of schedule of meetings going forward
- Strategic discussions: mergers and acquisitions, recruitment, cybersecurity, risk analysis, etc.
- Administrative matters: health benefits, 401(k) investment portfolios
- Board development
Best Practices for Distributing Board Books
Time is at a premium for nearly every board director. Successful and productive board meetings begin with a well-prepared board book. Well-prepared meetings set the stage for instilling trust and confidence in the board members and the management team.
More and more, boards are discovering the benefits of using secure, password-protected web portals for preparing agendas, board books and meeting minutes. Board management software systems are efficient and cost-effective. Alleviating the use of paper for board books means that there is less chance of board books getting lost and it eliminates the need to collect board books after the meeting for shredding purposes. Online agendas and board books allow for last-minute agenda changes without having to reprint thousands of documents.
Best Practices for Meeting Minutes
Meeting minutes are inarguably one of the most important documents that boards produce. They stand as an official record of the board meeting. Current, former and potential stakeholders, including the courts, may request boards to produce copies of the minute for analysis and compliance.
Best practices for meeting minutes suggest that boards primarily record actions and decisions or a high-level overview of agenda discussions. To prevent undue legal matters, boards should also make sure that meeting minutes show that they did their due diligence in vetting and discussing important board decisions. This is another good reason for adding timeframes to agendas, which may serve as an official record of how much time boards spent discussing certain issues. Legal firms contend that highly detailed minutes can be problematic for boards, as courts may misinterpret the board’s true intentions.
Best practices also suggest that boards consider adopting a policy that requires them to destroy all notes and other records that don’t become part of the final minutes, including board members’ notes and scribblings.
Electronic Software Solutions Provide Enhanced Governance Tools
Best practices become the norm for preparing agendas and minutes when using a total Enterprise Management Solution by Diligent Corporation. In fact, Diligent Corporation developed an entire suite of governance tools for boards with Governance Cloud. The solutions in Governance Cloud allow boards to complete all of their duties, including D&O questionnaires, board evaluations and secure messaging, within a highly secure online space.
Final Tips for Best Practices for Board Meetings
One thing that seasoned board meeting planners agree on is that details matter. Choose a setting that is comfortable and accommodating, but not so lavish that it calls attention to potential overspending. Board directors expect to have the right technology in the boardroom and to have no problems getting it to work properly. Make sure boardrooms have the proper equipment for teleconferencing, video conferencing and slide sharing, if necessary. Meeting planners should arrive in plenty of time to test all electronic equipment. Boards that use electronic board books may consider providing tablets to view the board books for the day of the meeting, which the Corporate Secretary can collect at the end of the meeting.