Board management is an art: your board oversees the direction of your organization, but who oversees the efficiency and effectiveness of your board?
By adopting some board management best practices, you can dramatically streamline your board’s operations and ensure you equip your organization to respond to an ever-changing corporate landscape. With risks and opportunities evolving faster than ever before, the board needs to be agile, capable and effective.
We’ve identified seven board best practices for 2022 to keep you a step ahead.
7 Best Practices in Board Management
1. Stay On Top of New Risks, Opportunities and Best Practices
Keeping abreast of best practices is a best practice in itself. Issues like cybersecurity and climate change wouldn’t have been on the average board member’s radar just a decade ago — but today, they are front of mind. Not just that; get your approach to them right, and it becomes not just a compliance tick but a chance to shine.
Similarly, the regulatory and legislative requirements you need to comply with are ever-evolving. Joining industry forums or subscribing to relevant newsletters will ensure that you’re in tune with the ever-changing corporate landscape.
2. Keep Shareholders and Stakeholders Top of Mind
When identifying and striving for best practices, your stakeholders should be front and center in your thinking. This doesn’t just mean investors: all stakeholders are increasingly vocal about the issues they think organizations and their boards should prioritize.
Engage with these stakeholders: experienced non-exec director Ray Troubh believes that “interaction of the large shareholders and the board members should be more frequent” than it’s traditionally been if you’re seeking best practice stakeholder engagement.
3. Cultivate an Agile Approach…
We saw during the Covid-19 pandemic the importance of agility; some businesses pivoted quickly to provide their employees with the support they needed and keep delivering to customers. This agility continues to be a key differentiator post-pandemic, as businesses adapt to operating in a post-pandemic world.
4. …and an Adaptive Board
This agility is as vital within your board as across the wider organization. Boards are evolving constructs. The best boards recognize when they need to bring in external expertise, drawing on skills honed outside your sector. They keep an eye on new trends in board make-up, like the advent of board technology committees to tackle changing risks. Don’t let an inflexible approach hinder your board.
5. Challenge Yourself On Your Diversity of Thinking
The days of boards being populated only by middle-aged men are changing. Businesses now realize that diversity of thought delivers strategic advantage and is the basis of an ethically-sound company.
How do you structure a board? The answer is: to provide a diverse range of thinking. Explore the benefits of reverse mentoring as a way to leave behind old thought processes. Question whether there are barriers to equality on your board, and ensure your succession planning techniques enable you to build a diverse board pipeline.
6. Get On Top of Governance
Whether this is following a best practice in separating out the roles of CEO and chair, or ensuring a robust audit trail for your board decisions, best practices in governance, as well as in risk and compliance should be a key focus of every board.
Running more effective board meetings is a core element of this governance, ensuring timely information-sharing before meetings so that decisions are made with a 360-degree vision and capturing actions to execute all compliance and board duties.
7. Explore All Routes To a More Efficient Board
This discipline in running board meetings doesn’t just benefit your governance processes. Boards of directors are busy people, balancing their board responsibilities with the other challenges of their role.
Board meetings and the business that follows them need to be carried out in the most efficient way possible to maximize effectiveness and best use of board members’ time. Board management software facilitates collaboration, streamlines meeting organization and bolsters security — saving directors’ time and driving better data-driven decisions.
Implement Best Practices To Accelerate Your Board Management
Board management is an evolving craft; however rigorous your approach, occasionally revisiting best practices is a good discipline. The seven best practices above provide a good baseline for any board wanting to challenge itself.
As above, growing numbers of boards recognize the benefits of board management software to streamline and finesse their board management. Board management software can help you run your board with confidence, minimizing admin and manual processes and creating a more secure, robust environment for your board.
You can find out more about market-leading board management software from Diligent here. And if you want practical guidance on finding the right solution for your organization, you can download a copy of our free Board Portal Buyers Guide.