How Board Management Effectiveness Reviews Can Improve Board Performance

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As a leader of the board, you have the responsibility to make sure that the board members have all the information they require to fulfill their duties and fulfill their obligations. This means that the board receives the information it needs from the management. Ideally, that means conducting regular Board Effectiveness Reviews.

A thorough process for evaluating performance can assist the board in getting perspective on a range of issues that may be holding back board performance. They could range from operational complaints such as the duration of meetings or agendas of the board to more complex concerns about the board’s role and the insufficient knowledge and abilities on the board. It could also indicate the need for new directors, or adjustments to director positions that are already in place.

The board should be clear about the purpose of its evaluation and should be the driving force behind the process – with the help of senior managers who communicate with the board on a regular basis. The board should agree to discuss the results and deal with any issues that arise.

A recent study that was based on nine years of board self-evaluation data from a renowned Australian consultancy that specializes in corporate governance and survey services, has identified 11 reliable factors which contribute to the effectiveness of boards. Six of these factors correlated solely or primarily to Leblanc and Gillies’ (2005) “how” items, which are distinct process elements that influence how boards function effectively. These include teamwork and communication within the board and the leadership of the chair, committee leadership, effective meetings, board self-assessment and efficient record keeping and management of information.

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