logo-small.png
- BLOG -

ON-DEMAND INSIGHTS

Best Practices for Board Meeting Preparation

Posted by Jordan Karp on August 7, 2015 at 10:41 AM

stock-photo-35387838-business-review

Board and committee meeting preparation generally falls under the purview of a company’s corporate secretary, a role often assumed by either the general counsel or CFO (or members of their in-house staff).  As important as this task is to ensuring proper governance, it can also present administrative challenges and be surprisingly time consuming. As a former GC, I know this first-hand, having assembled over 100 board/committee books and coordinated myriad details - some seemingly minute and trivial - over my nearly 25 years of practice. The benefit of this experience, however, is a keen sense of what works and what doesn’t when organizing meetings of board members and other business advisors.

Like many of Outside GC’s clients, small to medium size, growth stage companies tend not to have inside counsel to cover the corporate secretarial role, and therefore, rely on other members of the senior management team to coordinate board related activity, most often the CEO, CFO and Head of Business Development. In this article, I will share some best practices for board and committee meeting preparation intended to support your efforts ahead of the next meeting.  This advice is intended as a general guide – not a “one-size-fits-all” approach – which will invariably require some tweaking based on the nature of your business and the preferences of your board.

1. Plan Ahead

Regularly scheduled board meetings are typically held quarterly (or in some cases bi-monthly), with meeting dates for the year normally set at the start of the fiscal year. This predictability makes advance planning on your end not only possible but also highly advisable. For each meeting I suggest the following timeline for staying on task:  

1 month out:  Plan your agenda
2 weeks out:  Draft the board book and meeting presentation slides
1 week out:    Distribute the board book (and slides when requested)

2. Know your Chairperson well

First among equals in the meeting preparation process is your board chair. Before creating the agenda and compiling the board book, you should determine both the level of involvement desired by your chairperson, as well as his or her expectations for the organization and content of the meeting materials.  For example, some board chairs are more than happy to leave the planning to management, while others are interested in the micro level details or have particular preferences. Similarly, some expect a high level of detail in the book; and others require a standard “dashboard” approach to reporting key performance measurements.  Knowing what the chairperson expects (and other board members for that matter) is a key step to delivering an organized and thorough board book. Likewise, you should discuss the chair’s preferences around the timing and method of distributing the materials to board members. 

3. Create an effective agenda

Generally speaking, outside of matters that require board approval (e.g., the issuance of equity, termination of the CEO), from a legal perspective, management has broad leeway on topics that can be addressed at a board meeting, and agenda items will vary during the course of a fiscal year (e.g., approval of annual officer and employee bonus compensation typically occurs in the last meeting of the year or first meeting of the following fiscal year).

Nonetheless, there are a handful of matters that you should consider including on the agenda of the regularly scheduled board meetings as standing items for the sake of thorough governance.  They are as follows:

- Roll call
- Approval of minutes from the previous regular board meeting and any special meetings
- Board committee reports (executive, compensation, audit, nominating, finance, etc.)
- Department/Program updates
- Financial reports (financial and operating performance, cash management issues, including financing needs, revenues, and the like)
- Executive session – a time in the meeting when all company employees, including the CEO, are excused from the room (this is required of public company boards)
- Review of schedule of meetings going forward

Others items to address as needed, include:

- Strategic discussions (M&A matters, corporate collaborations, key employee retention/recruitment issues, etc.
- Other (reports from ad hoc committees convened to address specific matters like internal investigations)
- Administrative matters (review of health benefits, 401K investment portfolios, board/committee education, etc.)

4. Distribute board books efficiently

A well-prepared board book is a crucial component to a successful board meeting. When done correctly, it inspires confidence and trust in the management team.  Likewise, it provides the foundation for a meaningful and productive meeting.  Nonetheless, it can be an administrative inconvenience to create and disseminate multiple copies of the book, as well as to manage post-meeting collection of the books in keeping with the company’s litigation management and document retention policies.

Fortunately, there are alternative methods of distribution available. In recent years, many boards have started using secure, password-protected web portals to share their board materials. Besides the obvious cost savings, this method solves the occasional problem of lost board books and the need to collect books after the meeting. It also facilitates “posting” materials as they become available rather than having to get all the materials “out the door” at one time. The software even tracks which members have printed out materials so that the company can request a return of such materials. Although you may not convince all board members to use electronic distribution, it is always a good idea to present new options for more efficient and cost-effective alternatives. 

5. Sweat the Small Stuff (Embrace the motto: “No detail too small”)

Planning a board meeting extends well beyond the realm of agendas and board books. There are a number of key logistical issues to manage too.  Beyond selecting a location to hold the meeting, the meeting space must be outfitted with the right technology to conduct the meeting and support the needs of visiting directors.  For example, the proper equipment must be on hand for viewing slides during the meeting and ensuring conference or video call capabilities for board members or other meeting attendees who will be joining remotely.  Likewise, if the board book was shared electronically, you might consider providing tablet computers (just the reduced FedEx charges alone make this a wise investment) for each board member to access the materials before and during the meeting.

Equally important are items such as food, lodging and transportation. Provide assistance with travel plans and expense reimbursement for members visiting from out of town; get to know what your members like to eat and whether there are any special dietary needs. “Woe is me” to the corporate secretary who forgets to have fresh fruit when the board chair is craving a piece of pineapple.  To the extent possible, organize the agenda around travel considerations so that crucial items are discussed before board members leave to catch a flight out. Last, consider a standing dinner with the board either the night before or after the meeting to capitalize on their attendance.  These gatherings are a great opportunity for informal business to be conducted or simply to bring together the board and members of senior management.   Often, the real work is accomplished at these dinners.

While generally board committee meetings do not require the level of preparation or formality of a full board meeting, much of the guidance set forth above is applicable to them as well. Calendar those meetings, set the agendas, and get logistics in place as early as you can.

 

In sum, meetings with your board and its committees are an opportunity to draw on the experience and expertise of each board member as they relate to the company’s business objectives.  By taking the time to prepare thorough and informative materials, and by paying close attention to small, yet important, details, senior management can reinforce the impression of being thoughtful and organized, inspiring greater confidence among the board in its ability to lead the company in strategic matters far beyond the seeming tedium of board meeting preparation.

Topics: Corporate Governance

Subscribe to our Blog

Popular Posts

   
Outside GC is an innovative approach to legal services for growing and mature businesses. Companies who engage Outside GC fall into two main categories: (1) those without in-house counsel who need regular, on-going legal support but do not wish to hire a full-time in-house lawyer, and (2) those with in-house counsel who do not wish to add more full-time resources to their existing in-house staff. Contact us to speak to one of our on-demand attorneys.