The next time you’re in a board meeting think about the cost for each hour of that meeting. Estimate the hourly rate for each board member and each staff member in the room. Add those numbers to get a total hourly rate.
Is your board adding value worth the cost of those hours?
Much like education, good governance comes at a cost, …just not as much as the alternative!
How can your board generate its greatest value for this cost?
Let’s start by ensuring that the board is fulfilling its governance responsibilities. Too often, boards spend their time approving management proposals and requests. Not only does this take time away from the board fulfilling its responsibilities, these approvals are not the board’s highest value-added on behalf of the ownership!
If your board is using Policy Governance®, you will recognize that the board has three governance responsibilities it should never delegate to others. Astute boards adopt multiyear plans in which they ensure that they allocate sufficient time to each of these three responsibilities on an ongoing basis.
1) Ownership linkage: As the organization’s voice of the ownership, your board is obliged to have an ongoing conversation with its ownership. We haven’t time to explore all that requires in this blog. Suffice it to say, conversation is a two-way connection in which the board listens to the ownership about ownership values.
Listening Is not just a passive response to special interest groups. Instead, it requires a proactive plan to better understand a representative sampling of the diverse ownership. Your board’s plan, should be multi year. Plans for linkage development, implementation, and evaluation should be mapped into your board’s multiyear meetings plan.
2) Ensuring policy currency: If your board has done its job properly it will have policies which cover all of its aspirations and concerns. But those policies are not static.
As the world changes, Ends policies may need to be revised. Boards often focus in retreat sessions on input which informs its Ends decisions. Boards that add value also take time in their meetings throughout the year to enrich their understanding of topics relevant to Ends decisions. In such cases, the board proactively builds presentations and conversations into their multi-year plan.
Executive Limitations, Governance Process, and Board-Management Delegation policies are key to the conduct of both management and the board. They need regular, ongoing review and, if needed, revisions. Again, this needs to be mapped out as part of your board’s ongoing schedule.
3) Monitoring: boards that use Policy Governance monitor each and every policy on a regular basis. Monitoring all policies at the same time would be onerous for both staff and the board. Better, is to map a monitoring schedule onto the boards multiyear plan.
With a multiyear plan in place, your board can ensure that it fulfills its governance responsibilities. Yet there is still more your board can do to ensure its time adds value.
If your board is following the standard parliamentary procedure agenda (e.g., approving minutes, reports of officers and committees, unfinished (old) business, new business), STOP!
Instead, Structure your agendas according to the three board governance responsibilities. Include a slot for ownership linkage and time to enrich the board’s insights for its policy decisions. Add slots for review and, where needed, revisions for policies in each of the four policy categories. Ensure that monitoring of policies in each of the four categories is also included.
Set up this way, the job of creating the agenda is simply a matter of translating items from the multiyear plan into each meeting agenda.
Strategically position agenda items. You know how it goes. Items at the front end of an agenda typically get more time proportionate to their value than items at the tail end. By the time the meeting is in its closing hour, board members have less mental energy to contribute.
So, place those items which require deeper, generative conversations toward the front end of the agenda and place the more mechanical pieces (e.g., monitoring) further back.
Also, recognize that incidental reports from staff which are neither for monitoring nor to inform board decisions, typically get a lot of interest from board members. Let’s face it, board members like to hear about the internal workings of the organization, in spite of the fact that this does not provide the most value. Consequently, place that segment toward the end of the agenda.
By using these tips, your board can produce greater value for the cost of your governance.
If your board would like to further explore this subject, consider booking a discovery call with us. This is a free no-obligation conversation to learn how working with us could support your board in achieving role clarity, proactive risk management, and future focus. Book your call today!
Sign up for our virtual courses: Introduction to Policy Governance® and Assessing Monitoring Reports. Get more information here!