Building Effective Boards

ER Consultants has supported a number of Boards in building their performance through evaluating board effectiveness and running development programmes.  In particular, we provide the services of:

• Board Evaluation - Fulfilling the requirements of the Combined Code of Corporate Governance to evaluate individual director and board effectiveness.
• Board Development - Developing effective Boards through creating common visions of roles and interfaces and building both individual and team capability.
• Director Development - Coaching directors and providing an external challenge and sounding-board.
• Executive Team Development - Coaching and facilitating top executive teams to build strong leadership platforms for business growth and performances.
• Independent Director Development - Coaching and creating forums for cross learning and challenge.

The Combined code on Corporate Governance advocates that the Board should undertake a formal and rigorous annual evaluation of its performance and of its committees and individual directors.  Progressive public sector organisations are also adopting this approach, and are seeking to apply the six core principles in The Good Governance Standard for Public Services, as there is growing evidence that sustained organisational performance correlates with good governance.

However, there are understandable concerns that Board evaluation becomes a tick box exercise to fulfil external requirements rather than a genuinely useful tool that supports the continuous improvement of board effectiveness.  We have therefore developed an approach that is geared to improvement and development rather than just taking a snapshot of the Board's performance.  This covers the formal board role and processes as well as its performance and effectiveness, at a team and individual level as defined in the diagram below:

In some more detail, we evaluate and develop boards in the following areas:

Board Role

Board role relates to the degree of freedom the Board has in defining strategy, its more formal governance responsibilities and in engaging with its stakeholders.  This includes:

• Overall governance framework regarding the Board and its committees
• Clarity of matters reserved to the Board
• Clarity of decision-making and decision-support effectiveness
• Shared knowledge / understanding of long-term strategy, overall business model the issues, forces and risks that drive the organisation, stakeholder tensions, etc.
   

Board Process

Here we evaluate and develop how the business is managed through understanding how decisions are made and which decisions are being devolved.  This incorporates:

• Board committees
• Board review processes such as Agenda / Papers / Minute management
• The degree of shared understanding of how the organisation executes:
  • systems of internal control
  • business and financial audit
  • business financing
  • executive remuneration
  • succession

Board Performance

For Board performance, we assess and develop how the board involves all its Board Directors, and importantly, the quality of relationships between the Executive Directors, Non-Executive Directors, and the key stakeholders.

• Dealing with the right issues at the right time:
  • agenda management:  the ability to raise issues and get matters placed on the agenda
• Dealing with the right issues in an effective manner:
  • the degree of cohesion and alignment of the Board
  • information management
  • decsion-making effectiveness
  • contribution to / commitment to / involvement in agreeing strategy, governance, performance, ethical conduct, remuneration and risk management
• Relationships with Executive Directors - outside as well as within Board meetings.
• Relationships with the key stakeholders - how the Board interacts with government - national and regional, financial institutions, business, researchers and consumers

With an effective Board Evaluation process, followed by a Board Development Programme, ER Consultants can help you radically improve your  board performance.

If you require more information, please contact:  Gary Ashton, gary.ashton@erconsultants.co.uk   Tel:  +44 (0) 1223 315 944