It is crucial that the board conducts a thorough director review that is effective. Not only should the process be timely and transparent, but it should assist the board know what its strengths and weaknesses are so that it can improve its performance, and therefore that of the company.
It isn’t always easy to evaluate the performance of each director. The Chair’s contribution to the board has a huge impact on others. It can be difficult to compare boards due to differences in strategy, company cycles, and director refreshment policy.
The way in which a director’s board review is conducted can influence the honesty of the feedback. Some reviews are more informal – simply canvassing the views of other directors – whereas others are more structured such as interviews with fellow directors as well as the SID or CEO, committee chairs, and the Company Secretary. The review can include observations that a chairman makes during board meetings, including the degree of inclusion and information sharing, as well as the sharing of discussion.
It’s often helpful to use an external facilitator who has experience in conducting these reviews – their neutrality can bring extra rigour and objectivity to the process. It is crucial to start the process by delineating the scope and setting the goals of the review. The next step is to design a plan on how to assess the board and to gather insights from stakeholders. This could include the distribution of questionnaires official website and interviews, document reviews and/or using board management software.