The Corporate Law Group

Good Board Meeting Practices

Board Meeting
11 thoughts on good board meeting practices:

1. Three weeks before the meeting decide on the agenda items, number of option shares to be granted and vesting measurement dates for recent hires, and whether or not the meeting follows a quarterly or annual financial close.

2. Assemble financials since the last meeting (recent annual and/or quarterly if appropriate), performance against plan, optionees’ lists, issues with accountants, proposed resolutions to be considered, minutes of prior meetings needing approval, agreements being considered at the meeting, banker slide decks, agenda, and any other background information that would be helpful to the Board and distribute 1-2 weeks ahead of the meeting.

3. If there are difficult issues to be discussed at the meeting, call Board members, alert them to the issue, tell them your thinking and poll them. At the meeting the discussion should be robust, but try to see if you can build a consensus, or possibly change your thinking and withdraw the issue, in advance of the meeting.

4. Determine if there are travel costs to be reimbursed or stipends to be paid and, if possible, have checks ready at the meeting. Possibly offer to make travel arrangements for Board members from out of town. If several people are from out of town, or even if they are not, possibly host dinners or mixers so that the Board can interact informally.

5. At the meeting try to drive a good discussion regarding the most important issues facing the Company. Don’t use Roberts Rules of Order or anything else to limit discussion. Let all Board members speak as much as they want, within reason [no filibusters at Board meetings]. If Board members are on the phone, ensure that everyone can hear everyone else at all times. Don’t ever mute them, unless they are being asked to “leave the meeting,” and then only after they have been informed and have agreed. Try to get consensus on as much as possible. Feel free to table matters in favor of more information or additional consideration. If the Board is heavily split (i.e. 5-4) give the minority some deference and see if a stronger consensus is possible.

6. If corporate officers are making presentations, have their presentation be succinct and to the point that is requiring Board action. If the presentation is informational and there is no Board action needed, try to limit the presentation to 5-10 minutes unless circumstances require otherwise. Ensure that everyone presenting is well prepared for follow up questions from the Board.

7. Keep discussion civil, but robust. You should identify the issue and then propose an action or plan. Don’t ask the Board what it thinks before stating your plan. Encourage dissent where it might lead to clearer thinking on an issue. Invite members with minority views to elaborate on their thinking. Ensure that no one is afraid to voice their viewpoint. They are on your board to help steer the ship; listen to them. After listening it’s OK to disagree. The best Boards are not rubber stamps.

8. If observers or other non-Board members are present, feel free to ask them to leave from time to time if privileged or trade secret matters are being considered. Think hard before offering participation for observers in excess of what you have agreed. They have no right to speak and certainly no right to vote on anything.

9. Think hard before adjourning a meeting. Adjourned meetings may be able to take corporate action even without a quorum of directors present. Adjourned meetings may be manipulated unfairly.

10. Understand that your obligation, just like every other Board member, is to do what is best for the Company and its shareholders. At the meeting no one should be just considering or representing one class or series of shareholders.

11. After the meeting have counsel prepare minutes for review first by the Secretary and CEO and then to be distributed to all Board members for review for the next meeting.