Effectiveness of the board’s management becomes more crucial as the pace of business increases. Boards must be able sift through the “known knowns” and focus on strategic imperatives that drive long-term value, and guide companies towards their objectives.
To do this, they need access to the information that allows them to spot and address emerging risks quickly and effectively. In addition, they should be able to establish an environment of constructive disagreement and engage in honest debates that challenge the views of the majority. To do so they need to have the skills to sharpen their professional skepticism, and develop the courage to raise red flags – in the boardroom as well as with company leaders.
Boards must also have procedures in place to discover new talent, recruit these candidates and then bring them into the fold. The board is a living organism and when directors leave, they must be replaced by people with the appropriate mix of experience, skills and competencies to meet the company’s evolving needs.
Additionally, it’s essential to establish a procedure that ensures that decisions made in the boardroom are reflected in the actions taken by committees. This is typically where boards fall down because of lack of clarity or https://www.yourboardroom.net/boardmaps-software-advantages/ a disjointed approach. A well-designed evaluation process can help highlight these issues and give constructive feedback to directors without singling anyone out for criticism. This can assist the board in proactively addressing leadership gaps and ensure that it has the capability to achieve its goals.