Board Meeting Facts
Board Meeting Facts
Contrary to what many believe, your board of directors do not make the majority of decisions for your company. While they may have authority in certain areas of significant importance (in an investment company that is venture-backed they are typically outlined in the governing documents as well as investment documents) however, the majority of important decisions are decided either by committees or by the CEO/management with input from the Board.
Board meetings are typically more focused on policy, planning and oversight functions than on business operations. However, the decisions made by a board can have a significant impact on a company. Therefore, it’s important to plan and conduct meetings for board members in a way that encourages constructive discussion and produces results.
To ensure that the board is informed, it’s important to make sure everyone is informed. Distribute board materials prior to the meeting to allow attendees to familiarize with the materials prior to the meeting. These documents should be concise and clear enough that they do not require more than an hour to review.
Next, set aside time for the board to discuss. Consider allowing attendees the opportunity to ask questions or offer brief comments in an open forum. Also, set aside time for presentations by external stakeholders. Schedule time for the consent agenda, one section where routine or noncontroversial issues can be ratified with a single vote and motion.
Finally, make clear the decision-making process during board meetings. Decide if the purpose is to reach consensus or if a formal voting procedure is required and set clear criteria to evaluate concepts. This will enable everyone to know their part in the process, and the potential consequences of a decision-making procedure that went wrong.