Sunday, December 19, 2004

How do we keep board members informed?

How do we keep board members informed?
Designing a Board Information System Good governance depends on enlightened decision making. Board members in turn need to be knowledgeable about the organization's status and needs if they are to make sound decisions that advance its mission. But boards often say that the information they receive hinders rather than facilitates good governance and strong leadership. They protest that they are overwhelmed with large quantities of irrelevant information, that they don't get enough information, or that they receive material too late to devote serious attention to it. An effective board information system should focus decision making, stimulate participation, and support an appropriate balance of responsibility between board and staff.
Types of board information Management consultant John Carver describes three types of board information:

Decision information is used to make decisions, such as establishing selection criteria for the chief executive. It looks to the future and is not designed to measure performance. Monitoring information enables the board to assess whether its policy directions are being met. It looks to the past and provides a specific survey of performance against criteria. An example is an annual review of an organization's strategic plan. Incidental information is for the general information of the board and not related to board action. Committee reports are frequently in this category.
Too often, board information is primarily incidental information. Although such material is useful for maintaining an overall impression of the administration of the organization, it is not usually specific or substantive enough to help board members make decisions or monitor the organization's success at carrying out its mission.
Establishing a system Establishing and maintaining a board information system is the joint responsibility of the board chairperson, board members, the chief executive, and staff members who work with the board. The board should discuss what information it needs to do its job how often it wants this information in what form it needs the information Given this board feedback, the staff can establish the content, format, and frequency of information they will provide the board.
Characteristics of good board information Barry S. Bader, a consultant and author specializing in hospital governance, identifies seven guidelines for developing effective board information:
1. Concise - Is the information communicated as quickly or as briefly as possible?
2. Meaningful - Is the information presented in relationship to a significant factor, such as a goal set by the board, past performance, or comparative data?
3. Timely - Is the information relevant to the current agenda?
4. Relevant to responsibilities - Does the information help the board or board committee discharge its responsibilities?
5. Best available - Is the information the best available indicator of the situation or condition being described? Can better information be provided?
6. Context - Is it clear why this information is important?
7. Graphic presentation - Could the information be presented better graphically than in words?
Basic ingredients of a board information system Every board must decide for itself exactly what information it needs. For most organizations, however, the following checklist is a starting point.
At least two weeks before each board meeting:
Agenda Information about issues for discussion, when appropriate Financial information Committee reports
At least two weeks before the board meeting at which it is discussed: Annual budget Audit report Strategic plan
After each board meeting: Minutes Notice of next meeting
Monthly: Financial report Significant published articles about the organization
Quarterly: Financial report
Regularly, when appropriate: Memo from chief executive summarizing current activities, accomplishments, and needs Updated material for board handbook Advance copies of publications, brochures, or promotional material Annual report