BOARDROOM BEST PRACTICES

What Should You Include in Board Packs?

Board packs are a busy director’s source for insights into the key issues affecting an organisation. The purpose of a good board pack is to get the right information to the right people at the right time so they can properly fulfil their duties as directors for the benefit of the organisation. As the Financial Reporting Council puts it: “The board should be supplied in a timely manner with information in a form and of a quality appropriate to enable it to discharge its duties.”

Deciding what to include in a board pack is both an art and a science, as is sourcing the material and assembling it in the most digestible format. It requires the company secretary or governance professional to practice sound judgment, strong project management and good communication between the different stakeholders involved. So, what should go into a board pack?

Striking a Balance Between Administration and Information

A quality board pack contains the procedural data needed for the proper functioning of the board meeting, plus the reports and figures needed to provide perspectives on the topics under discussion. It should give directors the data they need, which, combined with their own experience and skillset, allows them to contribute knowledgeably to debate and make informed decisions.

At a basic level, board packs should contain:

  • The board meeting agenda
  • Minutes of the previous meeting (for approval)
  • CEO report
  • Financial report including KPIs and forecasts
  • Board committee reports
  • Items of important board correspondence
  • Supporting information related to decisions being made during the meeting

Some of these items are standard for every meeting. But in the case of supporting information related to board decisions, the required information should be agreed upon between the chair and the CEO in consultation with the company secretary. The chair and CEO must bear in mind that the business of the board is strategic, not operational. On that basis, the board does not need to know the daily minutiae of the business, but it does need to be able to see the big picture and understand the broader factors that could affect its decision.

It is essential that the data provided to the board is up-to-date and reliable. The source of the information and the date it was generated should be clearly indicated and contributors briefed on the importance of delivering high-quality data.

Tips From the Field: Avoid Director Data Overload

When we talk to directors and corporate secretariat teams about board pack features, the thing they typically have in common is size. Packs that run to 600 pages are not unusual, and the advent of digitisation—far from streamlining the amount of information directors receive— has removed physical size limitations. This means that directors are often deluged with documents. However, more is not always better. Too much data can be as bad as too little, preventing directors from getting to the crux of the matter. There should be a focus on quality, not quantity, when building a thorough board pack.

It is useful to issue templates to contributors who regularly report to the board, so that directors can become familiar with the way information is presented. Templates that set maximum word or page counts for reports can also help reduce the size of board packs and encourage contributors to be concise.

Set Firm Deadlines for Board Pack Submissions

Another common complaint among board administrators is late additions and changes to papers, which can cause an administrative headache and reduce the amount of time directors have available to review materials. This is less of a problem if you are using a digital board portal as it is just a case of updating the information and notifying directors of the change. Last-minute changes to hard copy packs are much more problematic, necessitating the insertion of pages and re-collation of packs. And if packs have already been distributed when a change is needed, it is difficult to make.

To limit the disruption of late changes to board packs, give contributors deadlines well in advance of the planned distribution date and emphasise that these cannot be missed. One anonymous board administrator admits that she gives contributors deadlines more than a week ahead of when she needs information, to avoid late submissions.

Allow Sufficient Time for Review and Approval

The amount of time needed for review, revisions and approval by the relevant authority will depend on whether the organisation’s sector is highly regulated, the degree of scrutiny required, and the bandwidth of the key personnel.

A financial institution, for example, may need up to five days for a full review by the chair and CEO. In smaller organisations, each paper may be reviewed by the executive leading the appropriate department, and then submitted for a final review by the company secretary.

In either case, it is essential that there is sufficient time built into the schedule to allow for full review and accommodate any amendments that need to be made.

Make Life Easy for Directors With Simple and Logical Navigation

A board pack should be easy to navigate, with a clear and logical structure. Hard copy documents should have numbered sections to allow easy reference during the meeting. Digital board packs should have links between the agenda and related documentation, so directors can easily navigate to different items.

To wrap up: a good board pack is one that directors receive well in advance of the board meeting. Its content is agreed and authorised by the chair and CEO and it contains a balance of relevant information. It is concise, up-to-date and doesn’t overload directors with detail. It is presented in a logical, easy to navigate format and last-minute revisions are minimised as much as possible. Get the board pack right and you are laying the foundations for a productive, efficient board meeting with informed decision-making and good governance.

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