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8 Components that Impact Board Effectiveness

8 Components that Impact Board Effectiveness. Analyze Current Board Functioning. Board Composition. Board Information. Board Agendas and Meetings. Board Committees. Board/ Management Relationship. Board Leadership. Board Dynamics. Board Processes. Board Action Plan.

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8 Components that Impact Board Effectiveness

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  1. 8 Components that Impact Board Effectiveness Analyze Current Board Functioning Board Composition Board Information Board Agendas and Meetings Board Committees Board/ Management Relationship Board Leadership Board Dynamics Board Processes Board Action Plan Source: Great Companies Deserve Great Boards: A CEO’s Guide to the Boardroom, Palgrave-Macmillan, 2011

  2. Agenda Magazine 2011 Survey of 770 directors How effective do you consider your board evaluation process? Have you changed your board evaluation process in the past 2-3 years? 31%

  3. Board Engagement in Strategy Strategic Choice Strategy Implementation Strategic Alternatives SWOT (Strengths, Weaknesses, Opportunities, Threats) Educating the board about key business factors Where most CEOs Engage their Boards On Strategy Optimal Point to Engage Board On Strategy

  4. Appendices

  5. 5 Hallmarks of a High-Performing Board • When you ask the CEO and executives how the board about the board’s most significant contributions – how the board really adds value for the company – they reply positively and can give 2-3 specific and substantive examples. • When you ask the board members the same question, they can also provide 2-3 specific and substantive examples. • When you ask board members if the board can improve in any way, they can give you at least 2-3 ideas for further improvement – high performing boards become that way through a mindset of “continuous improvement”. • The climate of the boardroom is one of vibrancy, energy – good give and take on important issues impacting the company • The performance of the company – financial, operating and strategic performance – is strong. A high performing board ultimately guides a company to increased value for shareholders.

  6. How Satisfied are You With?? 15% 20% 50% Source: PWC 2011 Study of approx. 800 US public company board members.

  7. # of Outside Directors with Industry Knowledge: Top 100 CDN Companies (Spencer Stuart 2011 Board Index)

  8. Board Composition: Amazon.com

  9. Board Composition: Intuitive Surgical

  10. If There Were 13 Seats in the Boardroom….. Finance: Capital Markets Finance: Accounting Government Political, Regulatory Branded Goods Family Family CEO Experience Family Mergers & Acquisitions Industry Experience Food & Drink Industry Experience Retail Legal, Risk, Insurance International Experience

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