Board evaluations: Assessing the board in 8 simple steps
Only 35% of executives rate their boards’ overall effectiveness as excellent or good. The key to turning this metric around? Thorough and strategic board evaluations.
While board evaluations are critical, one of the worst things that boards can do is to view the annual board evaluation process as a rote exercise where they tick all the right boxes that will make investors happy. Boards should instead consider the time, effort and resources spent on board assessments as an opportunity to add value to the company. Having a good process for doing board assessments demonstrates that boards have the proper knowledge, skills and ability to provide strong oversight.
Board evaluations: A step-by-step guide
If you’re unsure where to start, this step-by-step guide will lead you through:
- What a board evaluation is
- Key components of successful board evaluations
- Board evaluation methods
- An X-step board evaluation process
- Best practices for conducting board evaluations
- Common board evaluation challenges and benefits
- Trends in board evaluations
What is a board evaluation?
A board evaluation is a structured process that assesses the performance, effectiveness and dynamics of a board of directors. Evaluations may examine the entire board or assess the performance of a single director. In either case, the goal is to ensure that the board fulfills its responsibilities effectively and contributes to the success of the organization’s governance.
Evaluations can also help catch early warning signs of board mismanagement, making them essential for catching underperformance and optimizing board effectiveness.
Key components of a successful board evaluation
The best board evaluations go beyond surface-level assessments to offer insights into how well the board meets expectations and advances the organization’s strategic goals. A successful board performance evaluation typically includes several components:
- Board composition evaluation: This portion of the evaluation will assess whether the board has the right mix of skills, experiences, backgrounds and perspectives. It will also assess diversity, tenure, independence and how well board members’ expertise aligns with the organization’s current and future needs.
- Board effectiveness evaluation: Most boards will also want to understand how the board functions as a whole, meaning the quality of discussions, decision-making processes, meeting effectiveness and how the board handles its oversight responsibilities.
- Roles and responsibilities: It is fundamental to clearly delineate roles between the board, management and individual directors. Evaluations should assess how well directors understand and execute these roles, including the effectiveness of the board chair and committee leadership.
- Strategic alignment: Boards should regularly assess whether their actions align with the organization’s long-term goals. Evaluations should examine how well the board supports, guides and challenges strategic planning and execution.
- Environmental, social and governance (ESG) oversight: Increasingly, stakeholders expect boards to provide strong oversight of ESG risks and opportunities. A thorough evaluation may examine a board’s engagement with sustainability, ethical governance and corporate social responsibility practices.
- Board culture and dynamics: Effective boards foster a culture of trust, accountability and open communication. Evaluating the interpersonal dynamics, inclusivity and psychological safety within the boardroom can identify areas where collaboration can improve.
Board evaluation methods
How you conduct a board evaluation is as essential as the evaluation’s contents. Each evaluation method offers different levels of depth, objectivity and insight, contributing to a more well-rounded view of board performance.
- Surveys and questionnaires: A widely used tool, the board evaluation questionnaire allows for standardized feedback from all board members. These instruments can be tailored to assess governance practices, strategic oversight or individual engagement. Digital platforms now make conducting a virtual board evaluation easy, simplifying data collection and analysis.
- One-on-one interviews: Confidential interviews — often conducted by an external facilitator — provide rich qualitative insights. These conversations allow board members to speak candidly about dynamics, challenges and opportunities beyond what a survey can capture.
- Peer assessments: Peer reviews allow board members to evaluate one another’s contributions. This method can be sensitive but can also enhance directors' accountability and personal development.
- External facilitation versus self-evaluation: Boards can conduct their own evaluations or hire board evaluation consultants. While a self-evaluation is cost-effective and impactful for boards with strong internal trust, external evaluation brings objectivity and specialized expertise, which is especially vital for high-stakes situations or first-time assessments.
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Discover more8-step board evaluation process
Step 1: Define your objectives
Establish what your board hopes to achieve through the evaluation. Clarify your objectives so you can set goals for the review and make decisions about the scope of the process. Be clear about the reason for the evaluation, whether mandated, to solve a problem or to send a clear message to investors that the board is committed to good governance.
In making these decisions, consider the size of the company, its stage of business and the impact of the competitors. If you use Diligent Directors & Officers Questionnaire software, part of Diligent Boards and the broader Diligent One Platform, you won’t need a team to complete the process. It can be managed quickly with just one administrator.
Step 2: Decide whom to evaluate
Boards that choose only to do individual board evaluations may limit their insight into problems related to governance and performance.
Peer evaluations are the best way to get a holistic view of the board’s performance. Board evaluation tools make this easy to do anonymously, which will yield more candid feedback. Peer evaluations will highlight individuals’ strengths and weaknesses. The results will also help boards identify gaps in communication between board directors or between board directors and managers.
When choosing individual director evaluations, the administrator can correlate the results with the whole board to determine the most appropriate action. Assessment platforms eliminate barriers associated with time and costs, so boards have adequate time to conduct evaluations that bring meaningful results.
Step 3: Determine what to evaluate the board on
Many of the issues the board wishes to tackle will fall into similar categories. Classifying the board’s objectives into themes will clarify problems and, hopefully, identify possible causes. Classifying issues also helps to test the practicality of specific governance solutions.
This step requires boards to consider objectives in light of best governance practices. This process should yield a list of areas for the board to investigate, and they’ll need to balance the objectives with the scope of the evaluation and the resources available for the project.
This is another valuable reason to consider using Diligent Director & Officer Questionnaires, which require fewer resources, can be completed in less time and yield more meaningful results.
Step 4: Identify who will provide feedback
Boards that only solicit feedback from the whole board and CEO evaluations will overlook valuable input from other places. With the Diligent Directors & Officers Questionnaires tool, it’s easy to get internal and external feedback.
Managers and employees are often valuable sources of internal feedback. Owners and vendors may also provide valuable external feedback. Government departments and major customers provide additional sources of feedback. A careful review of potential sources of information, along with a list of their relative advantages and disadvantages, will help administrators narrow down the most appropriate people to participate in the process.
Step 5: Choose your board evaluation approach
The next step is to decide on the evaluation techniques. Evaluation administrators are generally allowed to choose between a range of qualitative and quantitative methods.
Get qualitative data by creating questions that ask 'what,' 'how,' 'why,' 'when,' and 'where.' Qualitative data will help identify key governance problems and screen for new solutions. This process requires some subjectivity on the administrator's part, but it can be mitigated by using quantitative and qualitative processes. There are three main ways to obtain qualitative data: interviews, board observation and document analysis.
Quantitative data will yield results that are easier to measure, while qualitative results can be richer. Survey questions are the most common form of quantitative techniques used in governance evaluations. There is no best methodology for developing survey questions and an evaluation template. Still, the flexibility in designing survey questions in Diligent’s Director & Officer Questionnaires tool gives administrators the upper hand in constructing questions that will yield the most honest, true answers.
Step 6: Assign someone to administer the evaluations
The company secretary or chairperson is usually the best person to conduct the board evaluations. An independent director, lead director or board committee may also take the lead in the board evaluation process.
Boards are increasingly depending on third parties to conduct evaluations. With Diligent Director & Officer Questionnaires, the whole process can be done internally and anonymously. Boards that use electronic assessment have the option of hiring a third-party administrator and involving the talents of specialist advisers or consultants.
Step 7: Manage the results
The central objective of the board evaluation process is for the board to agree on an action plan to improve governance.
Diligent’s Director & Officer Questionnaires tool will put the evaluation results into the hands of the board directors shortly after they come in. The evaluation administrator can compare the results to the original objectives to customize charts, graphs and reports that supply the most accurate and valuable results. Boards can then determine how best to use their results.
Where boards have evaluated individual directors, the evaluation administrator and/or the board chair will review the results with individual directors privately. Results should be shared with senior executives when the evaluation focuses on communication and relationships between the board and managers. Typically, the whole board gets the results, and they should have an opportunity to discuss them in the boardroom.
Step 8: Maximize the results of board assessments
Once the results are in, boards must balance transparency and the interests of shareholders and stakeholders who desire assurance of faith in the board’s competence. Boards may release the results as part of mandated disclosures. This is another benefit to using Diligent Director & Officer Questionnaires because the program automatically creates visual reports that will quickly be ready for publication.
By communicating the evaluation results openly, the board sends a clear message of its commitment to governance and improving its performance. At the same time, positive evaluations will help confirm board effectiveness.
Best practices for conducting board evaluations
The above steps will produce a well-executed board evaluation. However, enhancing its impact requires treating board evaluations as foundational to board development and organizational growth. To do so, consider these best practices:
- Clarify what you want to learn: Don’t start without clearly defining the purpose of the evaluation. Are you assessing overall board performance or individual contributions? Defining goals upfront keeps the evaluation focused and actionable.
- Use a mix of methods: Combine tools like surveys, interviews and peer reviews for a more complete picture. Digital tools can streamline board evaluation questionnaires, while one-on-one interviews can be invaluable in uncovering deep insights.
- Integrate board evaluation technology: Digitization takes the pain out of manual processes for board evaluations. When your board opts to use digital board assessment technology, it streamlines the process for evaluation administrators, board directors and anyone else who offers feedback. Board directors will appreciate the time that electronic evaluations save them. They can access the evaluation using any device and even come back to it at a later day or time to complete it, if necessary. The system can also be set up to allow for anonymous answers to get more candid feedback.
- Engage a neutral facilitator when needed: Bringing in board evaluation consultants can foster openness and objectivity, especially if internal dynamics are complex or if it’s the board’s first formal evaluation.
- Prioritize confidentiality and psychological safety: Board members must feel safe sharing honest feedback. Ensure all responses — especially in peer assessment or interviews — are treated with discretion and care.
- Align evaluation timing with strategy cycles: Consider aligning your evaluation with annual retreats or strategic planning sessions. This capitalizes on the board’s naturally reflective posture during these moments and allows you to immediately incorporate any insights into governance improvements.
- Focus on improvement, not just compliance: Treat the evaluation as an opportunity to learn and grow, not just a checkbox. Use the results to create a clear action plan with follow-up steps, timelines and accountability. Depending on the board's exact needs, this could include additional training, relationship building or more.
Common board evaluation challenges and how to overcome them
Board evaluations won’t always go smoothly. Those who administer them are all too familiar with chasing down directors’ responses or resolving tech issues. Awareness of these challenges — and solutions for them — can ensure the process still leads to real improvement.
- Lack of buy-in: Some directors may see evaluations as unnecessary, threatening or bureaucratic. Frame the evaluation as a tool for learning and improvement, not judgment. Communicate the benefits: stronger governance, better meetings and more strategic alignment.
- Low participation or superficial feedback: Busy board members may rush through questionnaires or avoid candid responses. Using streamlined digital tools can make participation easier and ensure confidentiality, encouraging openness. One-on-one interviews can be another excellent option for collecting deeper insights.
- Fear of conflict or criticism: Boards may avoid complex topics, especially when evaluating individual members or leadership. Engage a neutral third party or board evaluation consultant to guide the process. Foster a culture where constructive feedback is welcomed as part of board development.
- Unclear or overly broad focus: Evaluations that try to assess everything simultaneously can yield vague or overwhelming results. Define the scope upfront. Focus on a few strategic priorities — such as board composition evaluations, meeting effectiveness or ESG oversight — then rotate focus areas annually.
- No follow-through on findings: When boards gather insights but don’t act on them, they can create cynicism for future evaluation cycles. Assign responsibility for implementing changes, setting timelines and tracking progress. You can also schedule periodic reviews of the results to promote accountability.
Benefits of regular board evaluations
Despite their challenges, board evaluations can be a powerful tool, particularly when done consistently.
“Board evaluations really are critical to a well-functioning board. I feel very strongly that a board seat should not be a tenured position. Sometimes, it’s treated as one. It’s only logical that individual directors are evaluated,” said Jon Foster, board member with Berry Global, Lear Corp., Five Point Holdings and Masonite International Corp. on a recent episode of Inside America’s Boardrooms.
Regular evaluations help boards evolve, adapt and lead more effectively in a rapidly changing environment.
- Improved governance and accountability: Regular evaluations create a structured opportunity to reflect on roles, responsibilities and performance. This builds a culture of accountability where directors take ownership of their contributions and collective outcomes.
- More substantial strategic alignment: Regularly assessing how well the board supports and guides the organization’s strategy can keep the board focused on mission-critical goals rather than getting lost in the weeds.
- Enhanced board composition and diversity: Routine board composition evaluations allow organizations to proactively address gaps in skills, experience or representation and form a succession plan thoughtfully.
- Increased engagement and effectiveness: Evaluations help directors feel heard, valued and motivated, especially when paired with feedback and action. They also improve board effectiveness evaluation metrics like meeting productivity, decision-making quality and collaboration. “
- Better oversight of key issues, including ESG: As issues like climate risk, social impact and ethical governance gain prominence, regular evaluations help boards sharpen their oversight of ESG performance and other evolving priorities.
- Trust and credibility with stakeholders: Investors and the public increasingly expect transparency and accountability. Routine, documented evaluations signal a commitment to strong leadership and continuous improvement.
Trends in board evaluations
The governance landscape has evolved rapidly in recent years, shifting organizations' expectations for their boards. Today’s most effective evaluations reflect emerging priorities and the increasing complexity of board responsibilities. Here are key trends and topics likely to appear in future board evaluations:
- Greater focus on ESG: Boards are under growing pressure to demonstrate meaningful ESG oversight through a genuine commitment to people, place and planet, not greenwashing. Modern board evaluations will begin to include specific questions about how well the board integrates these priorities into decision-making and strategic oversight.
- Integration with succession planning: Boards are now linking evaluation results to board and executive leadership succession planning. Regular board composition evaluations help identify skills gaps and future leadership needs, supporting more strategic recruitment and development efforts.
- Adoption of board evaluation software: The rise of digital board evaluation platforms has made it easier to administer, analyze and benchmark evaluations. These tools offer customizable surveys, secure data collection and detailed reporting, helping boards move from anecdotal feedback to data-informed improvement.
- Increase regulatory and shareholder scrutiny: Regulators, rating agencies and investors demand more transparency around board performance and governance practices. A growing number of companies are disclosing board evaluation processes and outcomes in their proxy statements to build stakeholder trust and demonstrate accountability. This larger push for disclosure will increase the demand for streamlined and defensible board evaluation methods.
Strengthen governance and oversight with board evaluations
Board evaluations should be the beginning of continuous board improvement, not a dead-end exercise. Despite the prevalence of board evaluations, many boards haven’t changed their board practices because of them. Tools like Diligent Boards, part of the Diligent One Platform, centralize evaluation insights in the same platform that boards manage governance, making it easier to put findings into action.
But the real test is the board evaluation report. The report synthesizes evaluation results in a digestible and actionable format. How do you prepare — and present — an effective board report?
Read our guide for the seven critical areas for your next report.
FAQs
Who should conduct a board evaluation?
Board evaluations can be conducted internally or with the help of external board evaluation consultants.
- Internal: The board chair, governance committee or corporate secretary often leads self-evaluations using board evaluation questionnaires or digital tools.
- External: Many organizations opt for external facilitation to bring objectivity, especially during leadership transitions or heightened scrutiny.
You can also use a hybrid approach — self-evaluation supported by periodic third-party review — to gain deeper insights and benchmarking data.
How often should a board be evaluated?
Most governance experts recommend conducting a formal board evaluation annually.
- Full evaluations should happen once a year, including board composition evaluation and effectiveness review.
- Periodic deep dives into committee performance, ESG oversight or strategic alignment can occur every two to three years.
Consistent evaluations help boards stay aligned with governance best practices and regulatory expectations.
What happens after the evaluation is complete?
After the evaluation, results are typically compiled into a board evaluation report by internal staff or board evaluation consultants. Next steps include:
- Discussing results in a full board meeting
- Creating action plans to address gaps in performance or composition
- Tracking improvements via follow-up evaluations or board evaluation software
What are regulators and investors looking for in board evaluations?
Regulators and investors expect boards to:
- Disclose their evaluation process in proxy statements or annual reports
- Demonstrate follow-throughs, such as skills gap analysis, ESG oversight or governance changes
- Show independence in the evaluation process, especially for high-stakes issues like succession planning or risk management
A well-documented and action-oriented evaluation shows that the board is serious about performance and oversight.
How does board evaluation software help with compliance or regulatory reporting?
Board evaluation software centralizes documentation, tracks changes and ensures secure record-keeping — key elements for compliance.
- Audit trails of evaluations and follow-up actions
- Customizable reports aligned with SEC, NYSE, or ESG reporting standards
- Role-based access for secure collaboration and transparency
The right digital board evaluation tool simplifies regulatory reporting while maintaining governance integrity.
Discover Diligent Director & Officer Questionnaires and request a demo >
What are the benefits of using board evaluation software?
Board evaluation software improves efficiency, accuracy and board engagement:
- Streamlined survey distribution and analysis
- Benchmarking tools to measure board performance against peers
- Easy visualization of results and trends
- Centralized, secure data storage
Using digital tools also helps reduce bias and improve response rates.
Can board evaluation software replace external facilitation?
Not entirely. Board evaluation software offers automation and structure, but external facilitators bring independent insights, qualitative nuance and expert recommendations. Together, they offer a robust and scalable board evaluation process:
- Use software for ongoing, efficient self-assessment
- Bring in consultants for periodic, in-depth reviews or when board dynamics are complex
Can board evaluation software track improvement over time?
Yes. Modern board evaluation platforms include tracking and custom dashboards to measure performance year-over-year. Boards can see how they’re improving in key areas like:
- ESG governance
- Strategy alignment
- Diversity and board composition
Tracking this data helps demonstrate progress to investors and regulators.
What’s the ROI of investing in board evaluation software?
The return on investment for board evaluation software includes:
- Time savings from automated surveys and reporting
- Better decision-making from clear performance insights
- Reduced compliance risk
- Improved governance reputation with shareholders and regulators
Over time, it strengthens board effectiveness and reduces the costs of ineffective governance.
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