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Has anyone ever said, ‘I wish I could go to more meetings today?’
Matt Mullenweg

Introduction

You may roll your eyes when you hear mention of a board meeting thinking that they are time-consuming and an unnecessary administrative burden on your business. But, they don’t have to be like this! Managed correctly, board meetings can be useful and can help your business grow.

It can be tempting, especially for a smaller company, to combine board meetings with senior management meetings (especially if you don’t have investors or external directors). It is good practice to keep them separate as board meetings give you the opportunity to step back and review the strategic approach of your company.

You should look at a board meeting as an opportunity to take time away from the day-to-day running of the company to focus on strategy, policy, performance and compliance.

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Let’s start with the basics

Let’s start with the basics: how can you make board meetings efficient?

Regularity: 5 meetings a year (quarterly meetings + 1 to review and approve the accounts) is a good target to aim for. Having too many meetings risks the board looking at day-to-day matters rather than strategic decision-making.

Planning: Schedule all board meetings for the year as soon as you can. Content does not need to be finalised but you should set the date, time, length and location of the meetings. It usually makes sense to schedule meetings for just after a quarter end.

Length: No one likes a long meeting but a board meeting scheduled for just an hour probably won’t be long enough! A suitable length for a board meeting is between 2-3 hours (with 2 or 3 short breaks built in).

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The longer the meeting, the less is accomplished.
Tim Cook

Attendees: All directors (including investor directors) need to be invited and you will need a minimum number (a quorum) to attend for the meeting to be valid. Other attendees should be kept to a minimum. Senior executives should be invited for particular items only. Consider having an individual attending (often your legal counsel or company secretary) to help run the meeting, keep track of action points, decisions and to take minutes.

Agenda: Your meeting needs to have an agenda. Agendas help ensure that the meeting has a good flow. All meetings should start with a very short governance section where you approve the minutes from the previous meeting, checking up on action points and considering the forward planner and should end with an opportunity for AOB.

Board pack: A board pack should be sent to the directors a few days in advance of the meeting and should provide directors with enough information to make the decisions that they are being asked to make. Directors are unlikely to read a board pack that runs to 100s of pages so packs should be kept focussed and informative. It is recommended that you have a template board paper (including a summary front page) to make it easier for directors to understand what they are being asked of consider and to control the length of the paper.

Running the meeting: There is generally a lead director (often known as the chair) who will run the meeting. This person will ensure that the agenda is followed. It is advisable to use your company secretary or legal counsel to support with the running of the meeting to help ensure that the meeting doesn’t get side-tracked.

Minutes: The minutes of the meeting should, at the very least, record the decisions taken in the meeting. While minutes do not need to be a verbatim record of the meeting, a person who didn’t attend the meeting should be able to read the minutes and understand what was discussed in the meeting and what decisions were taken.

Action points: Action points should be noted, with a due date for completion. Action points should be revisited at the start of each meeting to ensure they are completed.

Forward planning: A forward planner helps you structure the ebb and flow of your meeting content. Topics won’t be set in stone as the focus of a business may change but a forward planner document will help you set the agenda for each board meeting. It can also help record regular reporting items, annual approvals or items that directors ask to come back to a future meeting.

Your articles of association and investment/shareholders agreement (if you have one) will set out certain requirements when it comes to holding board meetings. These need to be followed.

Meeting content

You are all set to go with your meetings but what should they cover?

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The Board’s role is to pull management out of the trees to see the forest.
Pearl Zhu

Strategy: Every company will have a strategy setting out how it wants to grow over the next few years. Board meetings give you the time to check in with your progress and ensure that the strategy is still relevant. Board meetings are also a good opportunity to discuss new ideas for the business (linked to the strategy and a specific request for the board to consider rather than just a generic discussion).

Policy: Policies help to set a company’s values and the tone for how the company wants to operate on a day-to-day basis. It is vital that the Board approves all policies to ensure that the policies reflect how they want the company to operate and decides the correct route out of any issues arising from compliance with a policy. However, board meetings are not the place for detailed policy discussions.

Performance: It is important for the board to get regular reports from key areas of the business. Not only does this enable you to keep track on the company’s day-to-day performance and assess performance against strategy but it also provides you with an opportunity to spot trends (good and bad) in the company’s behaviour. Performance reporting often takes up a lot of meeting time and is too detailed; performance reporting should remain high level and link back to how the company is performing against its strategy.

Governance and Compliance: Board meetings are necessary to manage the legal and financial operations of the company. The Board’s tolerance of risk and risk management should be considered and reviewed by the board on a regular basis.

Exceptional items: Items such as an exceptional capital expenditure will need to be considered and approved by the board in a board meeting.

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You have a meeting to make a decision, not to decide on the question.
Bill Gates

Conclusion

Organised well, board meetings can be efficient and productive. Successful companies use board meetings to keep themselves on track to achieve the goals set out in their strategies which ultimately leads to growth.

Jennefer Francis My Inhouse Lawyer
Written by Jennefer Francis
Principal at My Inhouse Lawyer

One of our values (Growth) is, in many ways, all about cultivating a growth mindset. We are passionate about learning, improving and evolving. We learn from each other, use the best know-how tools in the market and constantly look for ways to simplify. Lawskool is our way of sharing with you. It isn’t intended to be legal advice, rather to enlighten you to make smart business decisions day to day with the benefit of some of our insight. We hope you enjoy the experience. There are some really good ideas and tips coming from some of the best inhouse lawyers. Easy to read and practical. If there’s something you’d like us to write about or some feedback you wish to share, feel free to drop us a note. Equally, if it’s legal advice you’re after, then just give us a call on 0207 939 3959.

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