By Mark Edge – UK Managing Director, Brainloop
Here’s the scenario: a company secretary manages board meetings from beginning to end. He or she will schedule the meeting, manage the agenda and ensure all the information is up to date and presentable in advance of the meeting.
Board papers enable directors to prepare for a meeting, allow them to contribute fully to discussions and enhance the capability of the board for good decision-making and overall board effectiveness. Easy, right? Well, actually, no.
We know that the process of creating, distributing and updating the board pack can be complicated and may take time. From spending time collating documents, dealing with contributors and chasing information from varying departments across the organisation, to creating and distributing large, heavy copy packs to directors. Thirty-three per cent of companies use email to distribute confidential board papers, but even email has problems: sending packs electronically can be troublesome as they can be too large and have to be sent across in several batches of emails. Email isn’t always the most secure method, either, with a plethora of research studies suggesting that email is the biggest attack vector for cyber threats.
Then, there’s the preparation for the meeting: directors need the packs before the meeting and they require the pack on personal and corporate devices. But board packs are often edited and updated at the very last minute.
It’s a conundrum. Preparing board papers is becoming a hugely time consuming and stressful task for the company secretary and teams. Did you know that companies are spending more than £40,000 a year developing and distributing printed board packs? Or that 48 per cent of boards still manually create and distribute board packs?
The effort is huge and can take up most of their time. Let’s look at the common challenges with board papers:
- Papers are enormous – anything up to and beyond 200 pages
- An over-reliance on management for information, where an independent expert may be helpful
- There is too much data that lacks proper analysis
- Individual papers are inconsistent in layout
- Much time and resources required for packs’ preparation and distribution
- There is lack of flexibility to incorporate changes
Let us go back to basics; what is the purpose of board papers? They are the key source of information for directors before a board meeting. The board pack supplies the data and information necessary to ensure that the discussion and decisions at board meetings are as productive and effective as possible, and that the meeting is as efficient as possible.
So, how can we ensure productive and effective discussions occur? We can start by looking at the quality of board papers. Let’s fix the board meeting.
How can we fix the board meeting?
Lose some weight Board papers are enormous. This means it can be difficult to digest and extract relevant information, which can slow down meetings and make it difficult for busy directors to fully engage in proper discussion during the meeting. We found during the Thomson Reuters Conference in 2015, where we interviewed more than 100 company secretaries, that 59 per cent of board papers contain between 100-200 pages and 11 per cent are between 201-300 pages. This is too big, so we need to trim some fat.
A bit of user experience In our research, we found that only 43 per cent of boards have issued written guidance, specifying standards for board papers. This means that more than half of UK boards don’t have standards for board papers. Papers can be inconsistent in layout and structure, presenting further difficulty for discussion and decision-making.
We also found that only 43 per cent of board papers always state whether each board paper is for information, discussion or decision. This shows a huge lack of purpose. You may have heard the term ‘user experience’ used widely across the digital and tech sectors; it refers to improving a customer’s journey from beginning to end – board papers need the user experience touch. Finding common visual language across all the documents within the board pack will ensure directors journey through the document with more confidence and at a quicker pace – helping drive productivity and purpose.
Summarise For time-poor directors, the executive summary is often a shortcut to the most important and relevant information. Executive summaries should be an integral part of the board pack. However, only 23 per cent of board papers use a separate cover sheet to summarise the contents of the paper. Longer and lengthier documents can be moved to a document library or reading room, leaving just summaries or excerpts in packs.
Resolving resolutions Resolutions are legally binding documents. These can be of varying length but, because it is a document that makes a formal statement about an issue, it is considered important for all the board to keep a record of it. Resolutions also help drive quicker decision-making. Twenty per cent of board papers indicate the desired action of the board using an explicitly proposed resolution. That’s 80 per cent of boards missing out on a clear, considered decision-making process.
“Finding common visual language across all the documents within the board pack will ensure directors journey through the document with more confidence and at a quicker pace — helping drive productivity and purpose”
Visualisation Only eight per cent of board papers include visual aids, such as charts and diagrams. It is always considered best practice to include visuals as a part of any analysis or conclusions. It helps board members consume information faster and is often better than endless paragraphs of text. The quality of data is also important: it shouldn’t be just raw data, there should be proper analysis. Visualisation is the key to shorter board papers and better decision-making.
- What should your new board pack look like?
- Minutes of previous meeting (with a separate list of follow-up actions)
- CEO’s report
- Financial report
- Other operational reports, as appropriate
- Board papers that require board input (for noting, discussion or decision)
- Summary of best practices
Be relevant There is no room for waffle,make sure that words and visuals are tightly focussed on the issue or discussion presented. It should reinforce the organisation’s values, objectives and strategy, making way for clear, considered conversation.
Be integrated Ensure that every member of the board is onboarded with the solutions, templates and requirements so that everyone is singing from the same hymn sheet. This will allow proceedings to move faster and more efficiently.
Keep it in perspective Ensure that all the information presented has context.
Be reliable and timely It is always better that the board receives information that’s a little imperfect in good time, than entirely accurate information too late.
Be clear Reports should be written clearly and simply and supported by the optimum use of visualisation. Key indicators and trends should be obvious.
The boardroom needs digitising
Yes, it’s time for the board to go paperless. Going digital provides better efficiency, greater ease, collaboration and, ultimately, better decision-making. Digital is a solution to all the arguments we have made for building a better boardroom.
Staying traditional is costing business time and money. Think of all the hours it takes for your teams to collate streams of board materials – as we’ve outlined above. These are outdated practices. The boardroom is where discussions are held about optimising the future of the business, why not start in the place where those decisions are made?
There are a number of technological solutions, called board portals, out there. These portals have the ability to streamline best practice, increasing collaboration and saving time to optimise the board meeting.
Imagine how much time and cost you would save instead of compiling board papers manually. You could work in real time, knowing about last-minute changes or comments made pre-meeting in an instant; directors could read highly confidential documents from their devices with no security risk; and, guess what? No paper. Digital is changing boardroom efficiency.
About the Author:
Mark Edge joined Brainloop in September 2014 and brings over 20 years of sales experience in the IT, security and networking industries. In his current role he is responsible for building out Brainloop’s UK team and driving the company’s growth across the region. Prior to joining Brainloop, Mark was Regional Vice President of Sales, UK and EMEA for Watchdox where he was instrumental in establishing what was then a little-known brand in the region, creating and building a pan-EMEA team.
Mark’s career has also seen him deliver senior sales roles for a number of blue chip technology companies including IBM, A10 Networks where he grew revenue year on year for three consecutive years and Citrix, where he ran application networking solutions sales for North America and EMEA. Mark has a degree in Economics and Russian from the University of Surrey. As well as speaking Russian, Mark can also speak in French, Dutch and Swedish.