Board assessment is too often viewed as a necessary evil — a mechanical process of checking off items on a list that ultimately has little real value for the board apart from meeting compliance requirements. However, we believe that an effective board assessment process has the potential to be transformational.
Each organization’s evaluation tools should be customized to the unique needs of their business. Here are some areas to consider including:
- Identify areas that need improvement;
- Determine whether the board member’s contribution is in keeping with the needs of the board and organization;
- Identify issues or areas that need more attention in board meetings;
- Evaluate the diversity and composition of the board; and
- Assess the strength of each individual board member and if they need further development.
Investors, regulators, other company stakeholders and governance experts are challenging boards to examine and explain board performance and composition. Boards should address this challenge—first and foremost through a tailored and effective evaluation process. In doing this, boards can work to identify areas for growth and change to improve performance and optimize composition in ways that can enhance long-term value. Boards can also describe evaluation processes and high-level results to investors and other stakeholders in ways that can enhance understanding and trust.
50 thoughts on “A QUICK GUIDE TO CONDUCTING BOARD EVALUATIONS.”
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