Effective board management requires directors to be committed to their responsibilities and to commit to the process and strive to keep improving. It also requires a solid infrastructure to aid the board and allow them do their best work. This includes the governance tools, processes and systems in place to manage meeting planning, materials development, portal management as well as logistics and communications.
The most effective boards are those that undertake a thorough analysis of mission-critical drivers and risks, and focuses on the involvement of the key stakeholders. This includes requesting reports about suppliers, customers and other key stakeholders’ behavior and trends. It also includes economic headwinds and opportunity. It also means getting out in the field to see firsthand how the company operates and then bringing the insights back for discussion with the board.
The most important aspect of this pillar is the fundamental trust and respect that has to exist between board members to allow for a high-quality discussion and debate, including difficult questions and perspectives. It is also important to create an environment which it is accepted and expected that the board can disagree with management.
The ability of the board to perform its job is dependent on the quality and accessibility of information. The most effective boards can make informed decisions when their information infrastructure is in alignment to the vision of the board of engagement, model of engagement, and mission. This includes a clear matrix of authority (sometimes referred to as a RACI Map) that clearly defines who is accountable to be accountable, accountable, consultative, or informed about specific issues and when these roles and the responsibilities have been met.
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