Effective board management requires directors to take their responsibilities seriously and commit to the process and strive to improve. It also requires a strong infrastructure to help the board and assist them achieve their best results. This includes the tools, processes and systems in place to manage the planning of meetings, materials development as well as portal management, logistics and communications.
The most effective boards are characterized by a continuous examination of the most important, mission-critical drivers risk and opportunities as well as a focus on the importance of stakeholder engagement. This involves requesting reports about suppliers, customers and other key stakeholder behavior and trends as well as economic headwinds and opportunities. It means going out to the field and observing how the company operates firsthand. Then, bringing these insights back to the board to discuss.
The most important aspect of this pillar is the fundamental trust and respect that must exist among board members to allow for a high-quality discussion and debate, which includes difficult questions and perspectives. It also requires a culture where it is accepted and even expected that the board will disagree with management.
The capacity of the board to perform its job depends on quality and accessibility of the information. The most effective boards can make informed decisions when their information infrastructure is aligned to the board’s vision and engagement model as well as its mission. This includes a clear map of authority (sometimes called a RACI Map) that clearly defines who is responsible, accountable, consultative or informed about specific issues and when these roles and the responsibilities have been met.