Thursday, July 9, 2020

Effective Corporate Board’s “SMART” Meeting Agenda

If a Board is to fulfill its fiduciary responsibilities to its stakeholders, it needs to take a professional and systematic approach to prioritize meeting agendas with “SMART” characteristics.

Corporate boards make communication with shareholders in a timely fashion. They encourage a climate of continuous learning and collective leadership. To improve the board leadership effectiveness, the corporate board’s meetings are not a comfortable place but continually challenging in order to step outside their comfort zone. The highly effective Board shows the ability and openness to "question itself and its decisions/ discussions. Here is a set of perspectives on using the "SMART" Objective Model to run the meeting:

Specific – require the corporate board’s agenda and discipline to stay on topic: Being specific requires that the boardroom agenda should stay on topic. An objective is specific if it is well-defined, unambiguous, and describes exactly what is expected. It requires those deliverables being tasked and delivered at a meeting. They should precisely identify the elements of activity or capability that must be improved upon. Thus, it's important to make an objective assessment of how the board meetings are organized, and how to facilitate a few hot topics with highlights, and how to improve senior leadership effectiveness.

Either making communication, negotiation, or presentation, senior board leaders should enforce communication effectiveness by adopting digital flavors and styles. Generally speaking, corporate Boards need to spend time on strategy, not operational issues that should be delegated to management or others. Although there are many times when boards need to spend time on operational issues due to their impact on the enterprise and reporting but should be the exception, not the rule.

Measurable – decisions are made, progress is reported, ROI comes from consistent efforts: The corporate board meeting should provide wise counsel on the broad range of issues and bring measurable results via a multidimensional lens such as decision effectiveness, informativeness, or leadership maturity, etc. Corporate boards should oversee the maturity of business management, they also have to improve corporate board effectiveness. If you routinely go over then review the agenda or meeting frequency, evaluate and reevaluate – are your measures appropriate? Satisfactory – is the meeting required? Does it support organizational goals/vision and does it produce those measurable results?

Most Board decisions are not so "bi-nary" as to demand a yes/no or up/down decision, but rather an airing of the issues and adjusting the terms to meet objections. Keep track of tangible results by making an assessment of key boardroom issues such as: Whether they can advise wisely and set the right culture tone. Whether they work as a team - no weak links or bottlenecks. Whether they assess their own effectiveness. Whether they act early when it comes to performance concerns, rather than waiting. Whether they are accountable and meet with varying shareholders, etc.

Attainable - the agenda is reasonable, you are not attempting to “boil the ocean”: Corporate boards nowadays have to spin many plates (accountability, strategy, policy, and monitoring) at the same time. In the real world, too many Boards get sucked into reviewing quarterly financials, and analyst opinions. It is an almost universal finding that the Boards spend too much time on compliance or operational issues at the expense of the future. But to facilitate smart meetings and improve the boardroom effectiveness, it’s crucial for their discussions and activities to become more performance-driven, not just compliance-focused. Make the board agenda reasonable and stay focused.

The key point is to well prepare crucial issues and collect feedback even before the meeting starts, and better to invest the time upfront to address concerns and achieve a workable agreement from the outset. To dissent on votes spurs discussions on the topic at hand, and get more Board members to actively participate. The balanced scorecard is a strategic performance management tool, which can be used by BoDs to keep track of their activities and decisions and monitor the consequences arising from these actions.

Relevant – Keep focus, and make sure all attendees are relevant as well: Oftentimes, the board members’ time is stretched thin so they do not allocate enough time to understand key issues and in many cases, board members are not motivated to be strategically focused. To keep the board meeting relevant and efficient, besides laser focusing on strategic topics, they should also keep evaluating their own performance and leadership effectiveness such as: Do they have decision-making wisdom based on synthesizing thought processes to make sound judgments? Can they work as a team - no weak links or bottlenecks. Are they critical enough to diagnose the problems, and find strategy defects or potential business risks? Does the board have creative tension, and are they creative enough to bring alternative solutions to the table? Can they avoid “Group Thinking” syndrome? Etc.

Applying deep insight and rubber stamping are such counter-propositions. To make the board meeting stimulating and effective - beyond relevant, both listening and telling are crucial for understanding issues insightfully and provide advice wisely. The digital Board is responsible for ensuring an appropriate mix of skills, knowledge, and experience are present or available for it to fulfill its functions, A professional board should embrace cognitive differences and complementary capability & expertise. Boards make the ultimate decision and they should really focus on organizing corporate assets toward the achievement of the corporate vision and mission.

Time-sensitive – be disciplined in your time management: The boards have to spread their limited time on many important things, so they need to have superior time management skills. Today, the corporate board’s agenda is less about mere information and document sharing and more about brainstorming and leveraging collective intelligence to make wise decisions cohesively.

Governance is a process for a group of people governing with an organized process. For the majority of the time, the board agenda should be focused on the performance progress toward the strategic goals, targets, schedules., etc, of the value maximization planning. Professional processes and methodologies are all important to run “SMART” boardroom meetings and practice board duties timely. It involves the creation of interactive multi-channel communication and sharing processes and technologies to generate awareness about the new digital reality.

If a Board is to fulfill its fiduciary responsibilities to its stakeholders, it needs to take a professional and systematic approach to prioritize meeting agendas with “SMART” characteristics, focus on strategic issues, advising changes, oversee risks, and improve board effectiveness over the long term to improve its leadership maturity.






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