Performance issues on boards are not uncommon and can be traced to a variety of reasons. These include having proper members on the board, maintaining a healthy atmosphere as well as ensuring access to information and conducting regular evaluations. It is vital to take the correct approach in these areas to raise the level of the board and business.
Board members are knowledgeable about many different topics however, if some directors have more knowledge than others, it could hinder discussion during meetings. Boards can tackle this issue by implementing mandatory training sessions for all directors on the relevant topics like M&A and new geographic areas or updates to regulatory requirements. This helps to level the knowledge of directors and ensures that all directors are prepared for board meetings.
The board hasn’t established the structures and procedures suitable for executing its responsibilities regarding assessment, such as establishing an internal committee that is responsible for gathering and analyzing performance data or regularly presenting assessment results to the full board to be considered.
Boards should make an investment in third-party assessments that are performed by a third-party. These evaluations provide an additional layer of knowledge and impartiality that may be lacking in an internal review. Professional evaluations can help avoid the risk of political gamesmanship by staying clear of accusations and focus on finding a common path forward for improvement. They can also act as a neutral messenger to deal with sensitive issues involving groups and egos. They can also provide a plan to ensure continuous improvement, which includes concrete plans and time-bound objectives. They can also provide advice that is based on best practices and industry trends, helping the board reduce its workload and increase the effectiveness of the board.