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Board Meeting Etiquette Part 7 (General Etiquette)

The effectiveness of Board meetings has a significant impact on the ultimate performance of an organization. And they require a certain etiquette in order to be most effective. But how exactly should they be treated? Why should we have them? What should be discussed? Who should attend? Answering such questions can be difficult for first-time entrepreneurs who find Board meetings to be a foreign experience. Even veteran entrepreneurs should be reminded of proper Board meeting etiquette. So I’ve asked some experienced entrepreneurs and investors to offer their opinions about Board meeting etiquette in the context of small, private businesses. Their responses have been compiled into a series of seven separate blog entries.

Please share any general thoughts you have about Board meeting etiquette.

“There should be an outline and opportunity for each member to have a time to express whatever they want, but overall, it should be at the direction of the Chairman. The Chairman needs to call for a vote. The Secretary needs to be assigned to take meeting minutes or find a 3rd party meeting “stenographer” or the meeting can be recorded for future reference. The Chairman needs to call for a specific vote on matters that Board members or management bring up for a decision.” –Jaime Villagomez

“Keep it simple.” –Allan Young

“Prepare a board meeting packet and distribute to board members at least one week in advance of the meeting.  Include items that require board vote and approval so board members can consider them ahead of the meeting instead of trying to process them in the meeting.  Detail in the board packet will depend on what your board members like – some like lots of detail and some don’t.  For the meeting itself, prepare a crisp, short presentation for the company overview, but keep a lot of data and detail close at hand. Take notes.  Be formal with items requiring a vote – introduce voting items by motion, seconded by another board member and voted upon by all board members.” –Gregg Rosann

“Since the CEO tends to stuff the board with trusted allies, some boards provide only a rubber-stamp function. This is a total waste of time. A good CEO is one who encourages honest discussion and toleratesdissention on major issues. Likewise, it is not good to have cross-directorships, where the CEO serves on the board of another company whose CEO serves on his.” –Robert Rieger

“As is the case in general, Boards have experienced various levels of legal liability and cooresponding challenges. As a result it is critical that Boards’ and their members consider seriously and manage accordingly their responsibilities and follow due process and legal procedure at all times. All topics and discussions should be held in greatest confidence and recorded.” –Tricia McGarry

“There can (and should) be issues discussed regarding the (always) pending threats to the business. Disagreements better happen in a board meeting. If it is a year of “feel good” meetings then the board is dangerously blind.” –Scott Spurgiez

“The Board employs the CEO, who is responsible for maximizing shareholder wealth. It is common for the Board to also employ other chief executives.” –Jacob Webb

Previous questions:

Pt. 1: What is the purpose of a Board meeting? Why should we have them?

Pt. 2: How long should a Board meeting be?

Pt. 3: Who should do the speaking in a Board meeting and why?

Pt. 4: When is it appropriate, if ever, for someone other than a board member to attend a Board meeting?

Pt. 5: How often should a Board meeting take place?

Pt. 6: What is the most important topic a Board of Directors should address during Board meetings?

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Board Meeting Etiquette Part 6 (Agenda)

The effectiveness of Board meetings has a significant impact on the ultimate performance of an organization. And they require a certain etiquette in order to be most effective. But how exactly should they be treated? Why should we have them? What should be discussed? Who should attend? Answering such questions can be difficult for first-time entrepreneurs who find Board meetings to be a foreign experience. Even veteran entrepreneurs should be reminded of proper Board meeting etiquette. So I’ve asked some experienced entrepreneurs and investors to offer their opinions about Board meeting etiquette in the context of small, private businesses. Their responses will be compiled into a series of seven separate blog entries.

What is the most important topic a Board of Directors should address during Board meetings?

“Vision, strategy, budget, performance, capital, strategic needs and opportunities, company health and items that may compromise the goals set during the yearly planning meeting.” –Jaime Villagomez

“It depends on the state of the company.  Leadership issues are constant.” –Allan Young

“There is a fairly standard agenda for board meetings; it includes a company overview (sales/marketing, operations, financials) and various corporate governance topics, such as compensation, audit, financing and legal.” –Gregg Rosann

“The board should consider the financial position, revolver balances, ethical concerns and violations, environmental matters, bank covenant status, tax issues, audit issues, etc. Note the main point here concerns the overview of proper management controls. It does not involve whether to purchase a new copy machine for the office.” –Robert Rieger

“Economic or financial conditional factors, oversight of general management and leadership and other operational issues are those areas that a Board is most equipped and typically tasked to manage. Boards generally assume some level of liability for an organization’s management and leadership oversight, sustainability and financial health and should focus accordingly. Boards are typically the forum for managing any structural adjustments to an organization such as mergers or acquisitions or major financing events including stock structure and distributions.” –Tricia McGarry

“Varies.” –Scott Spurgiez

“Corporate strategy–financial, sales and marketing, organizational, and managerial. It should also address past performance.” –Jacob Webb

Next question:

Please share any other thoughts you have about Board meeting etiquette.

Previous questions:

Pt. 1: What is the purpose of a Board meeting? Why should we have them?

Pt. 2: How long should a Board meeting be?

Pt. 3: Who should do the speaking in a Board meeting and why?

Pt. 4: When is it appropriate, if ever, for someone other than a board member to attend a Board meeting?

Pt. 5: How often should a Board meeting take place?

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Board Meeting Etiquette Part 5 (Frequency)

The effectiveness of Board meetings has a significant impact on the ultimate performance of an organization. And they require a certain etiquette in order to be most effective. But how exactly should they be treated? Why should we have them? What should be discussed? Who should attend? Answering such questions can be difficult for first-time entrepreneurs who find Board meetings to be a foreign experience. Even veteran entrepreneurs should be reminded of proper Board meeting etiquette. So I’ve asked some experienced entrepreneurs and investors to offer their opinions about Board meeting etiquette in the context of small, private businesses. Their responses will be compiled into a series of seven separate blog entries.

How often should a Board meeting take place?

“A quarterly Board meeting is sufficient with a yearly planning meeting last quarter of the year. The quarterly Board meetings can be in form of conference call or in person. Regular reporting of the company performance in the form of month end reports can be sent to the Board of Directors.” –Jaime Villagomez

“At least once a quarter.” –Allan Young

“Quarterly is a good time interval.  Anything less than that and it tends to be more of a micromanaging operational meeting, any more time than that and directors are too far out of the loop – again especially in a small company when even small decisions can have a big impact.” –Gregg Rosann

“Regarding meetings, there is no set schedule, but most companies have board meeting 6 or 8 times a year. It is not good to have too many meetings because management is usually distracted preparing dog and pony shows which detract from their daily duties.” –Robert Rieger

“Board meetings are typically scheduled monthly or quarterly depending on the level of involvement the membership would like to have or needs to have in managing the best interests of the organization. Complexity and size of the organization as well as economic and other market factors can also be a consideration as well as the type of organization and Board. Non Profit boards which typically are comprised of volunteers are generally held less often and for shorter periods of time.” –Tricia McGarry

“Once a quarter for a formal one with occasional conference calls interspersed when needed.” –Scott Spurgiez

“At least once a quarter in later stages. More often during infancy.” –Jacob Webb

Next question:

What is the most important topic a Board of Directors should address during Board meetings?

Previous questions:

Pt. 1: What is the purpose of a Board meeting? Why should we have them?

Pt. 2: How long should a Board meeting be?

Pt. 3: Who should do the speaking in a Board meeting and why?

Pt. 4: When is it appropriate, if ever, for someone other than a board member to attend a Board meeting?

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Board Meeting Etiquette Part 4 (Attendance)

The effectiveness of Board meetings has a significant impact on the ultimate performance of an organization. And they require a certain etiquette in order to be most effective. But how exactly should they be treated? Why should we have them? What should be discussed? Who should attend? Answering such questions can be difficult for first-time entrepreneurs who find Board meetings to be a foreign experience. Even veteran entrepreneurs should be reminded of proper Board meeting etiquette. So I’ve asked some experienced entrepreneurs and investors to offer their opinions about Board meeting etiquette in the context of small, private businesses. Their responses will be compiled into a series of seven separate blog entries.

When is it appropriate, if ever, for someone other than a board member to attend a Board meeting?

“A Board meeting can have an open and closed session. The closed session should be for Board members only and, on occasion, they can invite third party consultants that can add some value to decision making. However, the open session may provide an opportunity for other key individuals, members of the company or vendors, customers, to participate in specific presentations to help give insight to the entire Board. This should be at the discretion of the Chairman of the Board. ” –Jaime Villagomez

“By invitation from the board or when someone has obtained observer rights.” –Allan Young

“I am a firm believer in having company executives attend the board meetings. They can be excused for certain topics (governance, compensation, financing, etc), but especially when a company is small it’s important to have the leadership team participate.” –Gregg Rosann

“The agenda for the meetings usually provide a status report on the company. The CEO can provide this report, or more frequently key operating managers attend and give a broad overview on their businesses. Most times the managers stay only for their allotted portion of the agenda. This gives the board time to view and evaluate the performance of key managers with an eye towards succession planning.” –Robert Rieger

“Attendees or advisors are typically invited for the purpose of addressing strategic, unique or important areas of interest for the organization where the members are not equipped or uncomfortable in analyzing or voting against a measure of importance or concern. These visitors are usually restricted time frames specific to their requested involvement so they are not privy to otherwise highly confidential issues of the organization and to reduce their and the organizations liability.” –Tricia McGarry

“Attorneys – to apprise the Board of any substantive litigation, lenders (not often, but occasionally). Any large vendor partnership decision should include a board meeting (even if just by phone).” –Scott Spurgiez

“There is a tenancy for the effectiveness of Board meetings to be compromised when too many executives attend and are expected to report on their progress or performance. Extensive efforts must be taken by the Chairman to ensure that Board meetings are as effective as possible. Meetings should be succinct and to-the-point. Non-Board members should attend at the invitation of the Chairman as long as their opinion adds significant value to the progress of the meeting.” –Jacob Webb

Next question:

How often should a Board meeting take place?

Previous questions:

Pt. 1: What is the purpose of a Board meeting? Why should we have them?

Pt. 2: How long should a Board meeting be?

Pt. 3: Who should do the speaking in a Board meeting and why?

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Board Meeting Etiquette Part 3 (Speaking)

The effectiveness of Board meetings has a significant impact on the ultimate performance of an organization. And they require a certain etiquette in order to be most effective. But how exactly should they be treated? Why should we have them? What should be discussed? Who should attend? Answering such questions can be difficult for first-time entrepreneurs who find Board meetings to be a foreign experience. Even veteran entrepreneurs should be reminded of proper Board meeting etiquette. So I’ve asked some experienced entrepreneurs and investors to offer their opinions about Board meeting etiquette in the context of small, private businesses. Their responses will be compiled into a series of seven separate blog entries.

Who should do the speaking in a Board meeting and why?

“The Chairman of the Board should direct the meeting. He should set the agenda for management to follow to make sure all important topics to the Board are covered. Obviously, the Executive Team led by the CEO should have an opportunity to add topics that are important to the governance and direction of the company.” –Jaime Villagomez

“The Chairman of the Board. This title should go to someone who knows how to achieve 1 & 2.” –Allan Young

“The meeting should have a written agenda and be led by the CEO. There should also be a company Secretary appointed who is responsible for board meeting minutes. The Company overview is typically done by the CEO, but the CEO should not be the only speaker. Other company executives should be invited to participate and present areas of their business.” –Gregg Rosann

“The Chairman of the Board. Board members should be encouraged to air their views freely, but professionally.” –Robert Rieger

“Speakers should be equipped to manage and direct the meeting and attendees and be well aware and equipped to address formal structure and liability issues related to the conduct, content and process involved in a Board meeting. Speakers should keep comments and discussions at a high level and address areas of priority or current interest for the organization where the members can provide oversight, perspective and decision making.” –Tricia McGarry

“The chairman should do very little speaking until others have spoken. Of course, this depends completely upon what the agenda is and the agenda should always be aggregated by the chairman (with suggestions from board).” –Scott Spurgiez

“The Chairman of the Board should conduct the meeting and set the agenda. Key management should give reports at the direction of the Chairman.” –Jacob Webb

Next question:

When is it appropriate, if ever, for someone other than a board member to attend a Board meeting?

Previous questions:

Pt. 1: What is the purpose of a Board meeting? Why should we have them?

Pt 2: How long should a Board meeting be?

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Board Meeting Etiquette Part 2 (Meeting Length)

The effectiveness of Board meetings has a significant impact on the ultimate performance of an organization. And they require a certain etiquette in order to be most effective. But how exactly should they be treated? Why should we have them? What should be discussed? Who should attend? Answering such questions can be difficult for first-time entrepreneurs who find Board meetings to be a foreign experience. Even veteran entrepreneurs should be reminded of proper Board meeting etiquette. So I’ve asked some experienced entrepreneurs and investors to offer their opinions about Board meeting etiquette in the context of small, private businesses. Their responses will be compiled into a series of seven separate blog entries.

How long should a Board meeting be?

“A standard Board meeting should take 2-3 hours to review the company’s quarterly status. A longer 4-8 hour meeting should happen at least once a year for an annual review and strategy discussion.” –JaimeVillagomez

“As short as possible without being negligent.” –Allan Young

“Board meetings should be well planned, and efficient.  Like most meetings, longer does not necessarily mean better.  I’d say no more than 3-4 hours.  Also allow for breaks.” –Gregg Rosann

“Most meetings should last no longer than 1-2 hours in length.” –Robert Rieger

“Board meetings may take an entire day or several days but typically are 2-4 hours depending on whether they are conducted quarterly or monthly (whereby the quarterly meetings generally run longer). Attendance and business issues or agendas are generally a factor involved in the time lines.  Most non-profit board meetings are held as efficiently as possible to best support the membership time demands.” –Tricia McGarry

“It varies depending upon the subjects to be covered (assuming you are not meeting with just investors).” –Scott Spurgiez

“It depends on the stage of your organization. Longer meetings are necessary during infancy, such as 2 to 3 hours. Shorter meetings are sufficient in later stages, such as 1 hour. The shorter, the better.” –Jacob Webb

Next question:

Who should do the speaking in a Board meeting and why?

Previous question:

Pt. 1: What is the purpose of a Board meeting? Why should we have them?

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Board Meeting Etiquette Part 1 (The Purpose)

Board MeetingThe effectiveness of Board meetings has a significant impact on the ultimate performance of an organization. And they require a certain etiquette in order to be most effective. But how exactly should they be treated? Why should we have them? What should be discussed? Who should attend? Answering such questions can be difficult for first-time entrepreneurs who find Board meetings to be a foreign experience. Even veteran entrepreneurs should be reminded of proper Board meeting etiquette. So I’ve asked some experienced entrepreneurs and investors to offer their opinions about Board meeting etiquette in the context of small, private businesses. Their responses will be compiled into a series of seven separate blog entries.

What is the purpose of a Board meeting? Why should we have them?

“To inform the Board members about the status of the company. To discuss strategy and budget objectives. To illicit feedback from the members. To motivate the Board to support the company initiatives both during the Board meeting and beyond. To approve measures that impact the shareholders. To review management’s performance and allow the Board to determine if management needs to be rewarded or replaced. We should have them because management needs support. A Board is intended to help create that support and be a structure not only for “approval” but to be a “sounding board”. Also management needs a focused opportunity to discuss pros and cons of the business…good things happening and challenges. A Board meeting should be healthy dialogue analyzing managements recommendations. Approval should also be sought for initiatives that effect the shareholders directly or indirectly.” –Jaime Villagomez

“The purpose is to ensure fiduciary responsibility to shareholders and to help forward strategic decisions.” — Allan Young

“A board of directors at a small company is often made up of the principal investors and the Company’s CEO. Additional people may be asked to attend board meetings, such as the CFO, COO, VP of Sales, etc. depending upon specific topics.  Board meetings are an important part of a company’s operations — they are used to keep the company’s investors informed, to solicit feedback and to provide corporate governance outside of the typical company day-to-day operations.” –Gregg Rosann

“It’s best to begin with the purpose of a board of directors. The board is a governing body of the corporation which deals with major strategic issues. Their first task is to hire a CEO and approve a senior management team. They also have fiduciary responsibility for proper capitalization of the company and in providing an adequate return and protection for the shareholders. What is important is that their role is NOT as day-to-day operational managers. Frankly, this is an area where many boards overstep their bounds. They try to second-guess the management they hired by injecting themselves in daily decision-making. It is important for the CEO to have the management authority to run the business (and provide the necessary return for the shareholders). The CEO should have the courage and personality to stand up to board members who overstep their mandate in this area.” –Robert Rieger

“Board meetings provide invaluable perspective to a private, public and non-profit entity through the expertise and may times external perspective of its membership. They allow primary shareholders, corporate officers and investors voting control and oversight of most significant business operational, sales and marketing strategies. In addition, they monitor and measure leadership and management effectiveness. They often provide a check and balance against business strategy and tactics relative to moving priorities and time lines. They may allow an organization to tap into networks and solutions available through its membership where otherwise those opportunities may be difficult or costly to source or acquire.” –Tricia McGarry

“The purpose must closely align to meet the board members needs. Early in my business I wasted a lot of time giving reports to the board members that they either didn’t understand, or didn’t care about. For example, most investors are not interested in your day-to-day woes and all of the business information. Rather, they essentially ask two questions: 1) what is my ROI (current and projected) and 2) can we close the meeting? So the purpose of Board meetings should be to address the needs of those present.” –Scott Spurgiez

“The Board is the governing body of your organization. The purpose of a Board meeting is to provide the Board with the appropriate information needed to make the most educated decisions about implementing corporate government.” –Jacob Webb

Next question (Jan 19):

How long should a Board meeting be?