Boardroom Evaluation – if not, why not?
The performance of the board and key executives should be reviewed regularly against both quantitative and qualitative outcomes.
- ASX Corporate Governance Council
While boards often become highly skilled at monitoring and improving the achievements of management, it is far less common for them to give effective consideration to their own performance (by an external consultant)
Yet substantial benefits are available to the organization as a whole, to the board and to the individual directors -
Henry Bosch The Director at Risk: Accountability in the Boardroom.
Pitman Publishing Melbourne 1995
In the Australian principles-based jurisdiction, good governance strongly advocates that all boards participate in a periodic review process and, ‘if not, why not?’ Even when boards work together harmoniously and are successful, a well-conducted review can assist elite boards to proactively assess themselves, retrospectively and prospectively. Both directors and the group can benefit greatly from the process.
The boardroom is increasingly opening itself up to greater scrutiny and accountability. An effective evaluation process conducted by an external consultant can improve every aspect of governance as well as interpersonal interactions between directors and between board and management. Evaluation
can positively impact the ideas, the thinkers behind the ideas, the processes and the Solutions.
Key ideas covered –
Brief history – the development of boardroom reviews over the decades
Current advocacy in favour of boardroom assessment
How it might profile individual performance, interpersonal relations, strategy, decision-making, outcomes?
Is it a compliance box ticking exercise or a performance enhancing strategy to the company?
Director receptivity and participation factors
Recommended time frames, different approaches, methodologies, metrics
Internal review v’s external review
The role of the consultant and challenges for the consultant-as-messenger
Importance of responsible follow-up to justify the time, energy and resources.
How it might be embedded in PD architecture.
Case studies – boardroom reviews conducted with diverse organisations profiling different approaches used, difficulties encountered, outcomes achieved and lessons learned.
Key objectives - the participants will get –
An understanding of how the board evaluation process has evolved over the last decade.
Different approaches and orientations, the value of embracing it and the personal and organisational benefits of participation.
It will consider how the review process can empower and align directors’ individual goals and aspirations with that of the mission statement, to successfully confront internal and external challenges, in an increasingly complex environment.
Case Studies – Different review processes, how they were administered and what were the ups and downs of the process.
I have been a director of CBH for 12 years. A co operative is a very dynamic, challenging and constantly evolving business entity and the preferred strategies and structures are often hotly debated. I have been significantly involved in several difficult strategy and structural transitions and it isn’t always plain sailing. Nevertheless, our dedicated team of directors and executives has succeeded in growing CBH to a world class Cooperative benefitting growers, communities and the nation.
I have observed many board consultants during my time and they mostly contribute value. However, none have attempted to understand and appreciate the complexities and value of the Cooperative business model to the extent as Robert Gordon. He is comfortable challenging behaviours when necessary, dedicated to appreciating every viewpoint and tireless in supporting ongoing alignment of directors, management and strategy. Robert lives and breathes his job with dedication and always goes the extra distance rarely seen in the majority of professionals today.
The board voted unanimously, extending his contract for another two years in recognition of this value.
Wally Newman Chairman FAICD Cooperative Bulk Handling (CBH