Board Meeting Facts
Unlike the popular notion, the board of directors does not make most of the business decisions. Although they are able to make decisions in a few high-impact areas (in the case of a venture-backed business and many of the choices are described in the governing and investment documents) most important issues are decided by committees or the management team of the CEO with the input of the board.
The majority of board meetings are focused on planning, policy, and oversight functions and not business operations. The decisions of an executive board can have an enormous impact on the company. It’s therefore important to plan and run the board meetings in a manner that encourages discussion and also results.
The first step is to make sure all board members are well-informed. To facilitate productive discussions, distribute board materials in advance to allow attendees to learn about them prior to the meeting. Ideally the documents should be simple and concise enough that they don’t need more than an hour for review.
Next, set aside time for discussion in the boardroom. Consider allowing attendees to contribute brief comments or questions in open forum, and planning time for meaning of nominee director guest speakers from external stakeholders. Schedule time for the consent agenda, an area where routine or noncontroversial topics can be ratified by a simple vote and motion.
Also, be sure to communicate the process of decision-making during board meetings. Decide whether the goal is to reach a consensus or employ an official voting process and set specific criteria for evaluating the new ideas. This will enable everyone to know their part in the process, as well as the possible negative consequences of a decision-making process that has gone wrong.