Board Design and Build

BOARD

DESIGN AND BUILD

The days of smoke-filled rooms, with ‘friends’ getting together to discuss the company’s future are long gone, but unfortunately ‘rudderless’ boards continue. Smart companies and savvy stakeholders now want their boards to be a council of strategic advisors that can be fluid and flexible and have a deep understanding of the company and its future.

With nearly 30 years of experience in operations, coaching, and investing, at NEDx we may have learned a thing or two about what an effective, well-run board looks like. We have gleaned most of this hard-earned knowledge from witnessing what not to do.

Too many boards are poorly organised, with little or no -re-structuring, and an imbalanced composition of members.

Building a board is incredibly challenging, yet getting it right is critical in setting the tone for success from the start, elevating a burgeoning start-up to the next level or meeting the long-term needs of a rapidly growing business. When we are engaged to design and build a board, we spend a significant amount of time in the pre-build phase to ensure the foundations are strong. We spend time with the stakeholders, management team, existing board members to understand the dynamics, objectives and needs of the various stakeholders.

Key fundamentals in designing and building high impact boards:

What does the Company need?

Not all companies need a fiduciary board from inception, many start-ups will have some advisors that still serve the same purpose of providing guidance and it could also provide a trial period before a formal board is appointed.

Designing the Board

Choosing the right people is the most crucial part of the design and build process. The key here is to bring on people that complement the CEO/Founder and stakeholder’s key skill set. Those that understand the nuts and bolts, finance and operations, as well as stakeholder relations. Corporate governance can be taught, business experience and interpersonal skills cannot.

Vet and Onboard Directors

The recruitment of a board director should be treated with the same level of detail and care as you would a C Suite recruit. Detailed interviews, references, and clear communication of the company and stakeholder objectives should be standard practise. Additionally a comprehensive and well thought out onboarding plan is worth the time and effort.

Set Goals

It is crucial for the board and the individual directors to have set goals and objectives against which they can be quantitatively and qualitatively be measured. This is the best way to understand the performance and success of the board as a whole.

Structuring Effective Meetings

Board meetings used to be 90% presentation and 10% strategic discussion. Effective board meetings should be 20% presentation and 80% strategic discussion. A data dump by the management team does not serve any purpose of creating an effective board. Other elements, such as number of board meetings, board meeting templates, and minute taking should also be transparent and well planned. Board meetings should be set at least 12 months in advance.

Measurement Metrics

Board directors should also have set objectives normally outlined in a comprehensive Board Charter. An independent board audit, allows for an objective assessment of the directors and their value to the company.

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