Running an Effective Board Meeting
Before we get into the topic of running an effective board meetings, let’s assume that you have already created your board by following proper protocol. That is, you have a strong board of objective outside advisors, not your accountant, attorney, or best friend. We’re also assuming that each board member has a term limit, that you’ve protected all members from personal liability, and that you really want to do things well, before, during, and after each meeting.
Two weeks prior to each board meeting, board members should receive the following, either by email or regular mail:
- An update on the actions you’ve taken since the last meeting.
- The date, time, and location of the upcoming meeting.
- A bullet-point agenda for the upcoming meeting.
- The most recent income statement, balance sheet, and cash flow statement.
- Up to three major topics that you plan to discuss with the board, including a paragraph or two that provides a brief background on each topic.
- The dates, times, and locations of the next four meetings.
- While it’s a matter of personal choice, you might want to mail board members their checks in advance rather than distributing them at the meeting.
Regardless of whether the meeting is three hours or four hours in length, here’s a typical allocation of meeting time:
- Roughly the first half-hour is devoted to answering questions about the financial statements that were sent to Board members in advance. Board members should be expected to have already reviewed them prior to the meeting, so it’s not usually important for the business owner to go through the statements in the meeting unless there are some unusual circumstances.
- Allow the next fifteen minutes to provide any additional details about the action items taken since the prior meeting.
- If you’re meeting for four hours, then you can devote approximately three hours to cover key topics on your agenda. If you’re meeting for three hours, then you can devote about two hours to discuss those topics. Be sure to allow time for a break at some time during this discussion.
- During the final fifteen minutes, summarize the action items from the meeting, ask Board members for suggestions on how to improve the format/flow of future meetings, and establish the dates for the next four meetings while your Board members are still in the room with their calendars ready.
Some business owners like to invite their key executives to attend a portion of at least one meeting each year to report on sales, finance, strategy, operations, or some other specific area. This is certainly an acceptable practice, but be sure that their attendance is limited to a very short part of the meeting, since the Board will be discussing topics that are extremely confidential.
Another common practice is to devote certain meetings each year to specific topics. For example, the fall meeting might be focused on the budget for the upcoming year, while the spring meeting is set aside for reviewing the three-year strategic plan. Your Board members can help you determine what practices might be appropriate.
Most business owners distribute checks to board members before they leave the meeting, unless they’ve already mailed the checks in advance. It’s not a good practice to mail the checks after the meeting since it can convey the message that their input isn’t valued.
Within a week after each Board meeting, it’s important that you touch base with each board member to thank them for their time. Unless you’re concerned about providing confidential information electronically, this is typically done by email. Your message should include:
- Minutes from the most recent meeting in a brief, bullet-point format.
- A summary of the action items from the meeting, again in bullet form, along with who has been assigned each action item since there are occasions when board members will accept action items.
- A reminder of the next four meeting dates, times, and locations.
Many business owners feel apprehensive about contacting Board members between meetings. If you’ve selected the right Board members who truly want to help, they’ll not only be willing, but anxious, to talk with you between meetings, and they’re often disappointed when they don’t hear from you one-on-one at least once a year over breakfast or lunch. So be proactive in keeping board members updated between meetings, regardless of what method you use — email, regular mail, phone calls, or face-to-face meetings.
Bill Matthews is Co-Founder of The WOW Business Advisory, LLC, and author of Five P’s to a “WOW!” Business. Copyright 2012-2016 by The WOW Business Advisory, LLC. All rights reserved.