8 Questions Every Board Should Ask About the Company, the Leadership & Itself - Boardroom Insights & News

8 Questions Every Board Should Ask About the Company, the Leadership & Itself

Being a member of a board of directors in today’s business landscape is tough. From shareholder activists to demands from the public about ESG disclosures, corporate governance is constantly scrutinized and has become increasingly challenging as more responsibility is added to board members’ plates.

Still, with so much responsibility at the roundtable and seemingly insufficient time and information to truly understand what’s happening in the company:

  • Boards can easily get mired in others’ priorities.
  • Board members can get comfortable making major decisions without the critical insight they need to govern well.

Unfortunately, this all makes it incredibly difficult to take an active role in governance, which isn’t ideal for a body responsible for setting corporate direction and strategy. Consequently, it’s vital for any board to continually evaluate itself and its dealings with the CEO and company to uncover ways in which it needs to improve processes, gain new knowledge, and set itself up for success. 

Asking these eight critical questions is key to accomplishing this goal.

1. What Is the Process for Setting the Board Agenda?

The board meeting agenda keeps everyone on track toward a common goal. As the chairperson and secretary create agendas, it’s vital that ground rules are respected and that the entire meeting isn’t dominated by the priorities of a few.

It’s a good idea to periodically review your board’s process for setting an agenda to ensure it’s standardized and fair and covers topics that are necessary and relevant to the business.

2. What Should Be on the Agenda but Isn’t?

Board members sometimes miss out on important discussions for a few reasons:

  • The chair may not view a particular topic as essential or relevant
  • Members may not feel they have enough information or expertise to address it
  • Key members may not speak up about what needs attention 

Set aside time to hear from members about what might be missing from the agenda and then work to resolve it. If you need help from a subject matter expert, bring one in. If you see relevant topics missing, bring them up so they can get the attention they deserve.

3. How Well Have You Learned to Trust Each Other?

A board where the members do not trust each other cannot work together effectively. Board members need to feel comfortable challenging groupthink and sharing insights candidly.

This is even more important when discussing topics within their area of expertise. 

If board members don’t trust each other, they’re less likely to:

  • Listen with an open mind.
  • Believe the best of those who bring up concerns.
  • Speak up when it matters most. 

This kind of unspoken strife ultimately hurts business growth.

Consequently, board chairs should make it a priority to help board members get to the bottom of their feelings of mistrust and build relationships where open and honest conversation is at the center.

4. What Is the CEO Not Sharing That You Need to Know?

A CEO not sharing information isn’t always about hiding things or engaging in unscrupulous behavior. Sometimes, it’s about the board not asking the right question or a CEO not wanting to report on the bad news. An effective board needs to know what’s going on in the business. 

The CEO should be reporting the good, the bad, and the uncertainties so that all can be considered, discussed, and dealt with. It’s never a good idea for the board to work with incomplete information, especially for critical decisions.

5. How Good Are You at Discussing Challenging Topics?

This question is about so much more than just discussing the elephant in the room. It’s about how well you and your colleagues can communicate when the stakes are high. Specifically:

  • Are you able to listen to each other and take feedback?
  • Are there cliques or sidebar conversations that could harm boardroom relationships? 

It’s important that you don’t let challenges divide you. Ensure you’re hearing all voices, asking good questions, and bringing in a third party for help when necessary.

6. Does the Organization Have a Consistent Culture?

It’s the board’s job to oversee company culture.

This is what creates employee buy-in and ensures the organization keeps moving toward the board’s strategic goals.

Before the board can influence culture, members need to be able to come to a consensus about what the culture is. 

Once you can articulate your culture, you must then develop a robust framework for measuring and monitoring it.

Taking the time to do this ensures better alignment and more consistent results throughout every level of the organization.

7. Does the Board Maintain an Appropriate Focus?

It’s easy for board members to become overwhelmed with discussing day-to-day operations and management. However, that’s not where your focus should be. 

Directors should concern themselves with broader issues of strategy, direction, and policy. If that’s not what takes up most of your time, a shift is needed. Put the focus back in the right place and let executives take care of management and operational issues.

8. Are Board Evaluations an Accurate Reflection of Governance?

Board evaluations should not be limited to vague statements like “The board works together effectively.” They should be much more impactful, detailing exactly what actions the board has taken to be deemed “effective.” 

An evaluation should include opportunities for much deeper reflection and a discussion of quantitative results that act as proof of performance. It should:

  1. Discuss elements like processes, internal controls, roles, and board dynamics.
  2. Always result in an actionable plan. 

If your board evaluation isn’t an accurate reflection of governance, consider changing or upgrading your evaluation strategy. 

Constant Learning Is the Path to Consistent Growth

It’s a given that corporate governance is a tough job, but one thing it should never be is passive. Even under mounting scrutiny and pressure, board members must:

  • Insist on having the time and information they need to evaluate themselves and ensure they’re making the right decisions.
  • Ask questions. This is absolutely integral to the decision-making process.
  • Review the agenda-setting process. Ask executives to fill in the blanks with missing information, learning about company culture and operations and evaluating the board’s ability to maintain trust, focus, and courage. This is vital to the health of the board and the company.

Good corporate governance requires starting from a foundation of truth. By asking the right questions and committing to a constant cycle of learning, the board (and the corporation it is responsible for) will be much better equipped for continued growth and expansion.

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