How to be an effective director: the role of director education

Women Get On Board event presented by The Directors College on November 9, 2016

Many will agree that a board of directors is much more than the sum of its parts. One of the most impactful factors in overall board effectiveness is ensuring that skills, expertise and personal attributes of individuals on the board meet the needs identified in the board skills matrix. Dr. Michael Hartmann, Principal of The Directors College, noted this as he moderated an insightful conversation with our panel of governance professionals consisting of Lynn Beauregard and Anna Paluzzi, C.Dir.

From left to right: Dr. Michael Hartmann, Anna Paluzzi, C.Dir., and Lynn Beauregard, President, Governance Professionals of Canada (GPC).
From left to right: Dr. Michael Hartmann, Anna Paluzzi, C.Dir., and Lynn Beauregard, President, Governance Professionals of Canada (GPC).

The panel explored how to be an effective director through the value of continued governance education, how to apply the lessons learned through formal education to real board experience and ultimately, how to evolve into an impactful and effective member of the board.

Value of taking formal board education:

I cant put a price on the networking and the relationships that extend beyond the course.
~ Anna Paluzzi, C.Dir – 2015 graduate of The Directors College

  1. Foundational information covering everything board related.
  2. Personal growth through conversations with peers with varied values, opinions, and ideas. As a board member, one requires the consideration and patience to ‘group think’.
  3. Expansion of professional network through dialogue and learning from one another.
  4. Everything learned and experienced through formal governance education is applicable to directors. You refer to the foundational information to help with the structure and processes of the board to be more impactful.

Drivers behind individuals taking formal education, Dr. Michael Hartmann, Principal of The Directors College:

  1. Knowledge: overall knowledge and thorough understanding of board responsibilities and dynamics provides confidence and certainty.
  2. Behaviour: by taking formal governance courses, students found it was a time of self-reflection, diversity of thought, and openness to altering pre-conceived views.
  3. Best governance practices and formal accreditation.

Accreditations show that you have the knowledge and understanding of the fundamentals and also embeds you in a valuable network. As a director, you need to think about where the gap is that you can help to close? Where do you have gaps that need to be developed? That may be quite focused versus formal education, that’s more holistic.
~ Dr. Michael Hartmann

What current or emerging topics do boards need to be better educated on?

Management needs to give enough information regarding its challenges in a manner thats understandable by all (no acronyms!). This is because board members are expected to make decision based on that information. That said, board needs to also ask questions.
~ Anna Paluzzi, C.Dir.

Orientation:

  • Interactive moments that create a dialog between the directors.
  • Individual training to facilitate a conversation regarding organizational risks.

Risk management:

  • What are you going to do to manage risk? What if the unexpected happens? As a board member you need to be prepared and trained to take on challenges.

Technology:

  • Understand and identify the gaps the organization has.
  • It’s about the context first, and the necessary technology second. What is the value the technology brings to the organization? How will technology help the organization fill the gaps?

Engagement:

  • Learn from the ground up what the organization is about, the decision you need to make and the challenges you need to solve. Engage with the organization’s community and stakeholders to understand the value of your decisions.

Key areas of focus:

  • Ensure inclusivity, appropriate orientation and fact finding for existing and new board members.
  • Identify gaps and information the board does not have.
  • Consider the unexpected and look to other industries and disruptions that occurred.
  • Learn from the ground up to understand the decisions the board needs to make, the challenges it needs to solve and the impact of such decisions on the community and the stakeholders.

What behaviours do board members exemplify to solve complex situations? How did you develop your own knowledge and skills as a director?

Youre only as good as the information, education and the support that you receive from the board members and senior leadership. Step outside of group-thinkbecause diversity of opinion adds significant value to the board.
~ Lynn Beauregard, President, Governance Professionals of Canada (GPC)

Key takeaways:

  • No egos or authoritarian approach to leading.
  • Step outside of personal viewpoints and be open to changing your perspective.
  • Ask questions that challenge.

What do formal board educators need to focus on?

Status quo doesnt work. The face of the boards is changing and educators need to refresh and bring the most up to date information [to its members and students].
~ Lynn Beauregard, President, Governance Professionals of Canada (GPC)

Key topics of focus:

  1. Innovation and diversity.
  2. Digital technology and digital disruption.
  3. Cyber risk.

How to manage change and how to be innovative. What trends are impacting TSX listed companies and how are other industries changing?
~ Anna Paluzzi, C.Dir.

What would you say to an aspiring director regarding taking formal governance education certification program?

The best way to get on a board, is to get on a board!
~ Lynn Beauregard, President, Governance Professionals of Canada (GPC)

Find organizations that are hungry for your expertise. Join a board of a smaller organization to get the confidence and experience, and then consider formal education.

Key takeaways:

  • Get on a board first.
  • Consider your aspirations.
  • Consider getting formal board accreditation once you’ve experienced being a board member.
  • Formal governance education is a big time commitment.
  • Sign up to Boardmatch to find opportunities.

What are your aspirations, where are you going with this, do you have the time to do this? Education should depend on what your aspirations are. But, I would highly recommend it. There is no downside. It help me become a much more effective director and share that information with the board.
~ Anna Paluzzi, C.Dir.

Whats the difference between being an effective board member and being an effective senior executive?

Nose in, fingers out but not mouth shut.
~ Lynn Beauregard, President, Governance Professionals of Canada (GPC)

The hats are very different between the board and management. As a board member, you’re there to provide guidance. You’re the visionary. You’re helping with the decisions, approving the direction but aren’t making those decision, that’s the job of senior leadership. A board should be more strategic in the thought process as opposed to operational.

If you’d interested about learning how to enhance your board experience and skills, read our “Top 3 Tips for Building a Board Profile”.

Conclusion:

Given a board’s critical role in being effective, it is important that each director ensures they devote time to ongoing education.

If you are interested in getting board ready, consider registering for a Women Get On Board workshop ‘How to get yourself on a Board on Wednesday, December 7, 2016. For additional information and to register for the workshop, please click here.

How to be an effective director’ derived from the Women Get On Board event held on November 9, 2016 was conceptualized, written and formatted by Nat Korol, partner at Hyphen Co., that partners with organizations to help navigate and implement the right marketing and design solutions to realize your business objectives.

 

How to Prepare for Corporate Board Roles

 

photo credit: alexisjordanlewis Board room via photopin (license)
photo credit: alexisjordanlewis

The first step in getting prepared to lead and serve on a corporate board is to make a plan. As, I’ve written about before, getting board-ready is a journey. A journey where you need to be realistic in your skills, experience and value that you bring to a corporate board while acknowledging that there are lots of qualified corporate directors looking for corporate board opportunities.

I’m often asked how to begin a corporate board journey. And my best advice is to ask yourself these 10 questions to help you prepare yourself to lead and serve on a corporate board:

10 Board-Ready Questions

  1. Do you have a minimum of 10 to 15 years of experience in a senior executive role in the public, private, crown or not‐for‐profit sectors?
  2. Are you prepared to commit at least 200 to 300 hours per year to a corporate board role?
  3. Do you have the support of your own Board of Directors and/or senior executives to serve on a board?
  4. Do you have a formal governance certification or designation (C. Dir or ICD.D) from the Directors College or the Institute of Corporate Directors?
  5. Have you ever served on a board, not‐for‐profit or for profit?
  6. Are you a team player that understands the dynamics of boards is one of the most critical components of good governance?
  7. Do you fully understand the role, responsibility and liability of a corporate director?
  8. Do you understand the difference between a board of directors role versus a management role?
  9. Do you have financial acumen—can you read and understand financial statements?
  10. Do you have experience in critical areas in our changing world such as Risk Management, International Markets, M&A, Cyber Security, Digital Media, Big Data, etc.?

To help you begin your board journey, Women Get On Board has two upcoming workshops; “How to prepare yourself for Board roles” on November 2, 2016 and “How to get yourself on a Board” on December 7, 2016.

Hope you can join us!

How to Build Your Board Resume

We would like to thank our Event Partner, Stanton Chase Toronto with Managing Partners Cathy Logue and Joanne  Elek for their support of  our April 6th Roundtable Event “How to Build Your Board Resume.” We also appreciate the participation of our moderator Kelly McDougald and our panellists Lisa Melchior and Tom Muir.

Building a Board Resume is a journey that involves many stages. It’s a continuous process of showcasing yourself as a board candidate through documentation, networking and interviews.

The concept of “wisdom trumps knowledge” and how this can add value to a Board

Even those who have deep experience and functional knowledge don’t always have all the answers. Wisdom is a combination of knowledge, judgment, and experience — all important components that go into good decision-making.

Some people feel that if they don’t have a CPA designation they don’t add value, but that’s not the case. Each board member has different things to contribute, and brings a unique perspective and experience. Sometimes, the most effective people to contribute to discussion and debate are those with the least subject knowledge because they can be objective.

The importance of being “multi-dimensional” for a potential board opportunity

During an interview, will you will be asked about your area of expertise and to demonstrate how much depth you have in your area of specialty. Over the course of your career it’s important to become an expert on something because it will increase your unique value. Board members will see not just how much knowledge you have, but more importantly, how you reflected on it and spent time applying that knowledge. They will look for your examples of how you handled decision-making in a stressful or difficult situation. Give them scenarios of how you worked through a very complex problem and produced great results. It’s about demonstrating where you lean-in and take leadership roles on committees and sub committees. Don’t be afraid to talk about your experiences.

The difference between a career resume and a board resume

A career resume highlights the roles and accomplishments you have achieved as a professional. A board resume showcases your unique value proposition and what skills/expertise and industry knowledge you bring to a board. You should demonstrate the governance leadership roles you have taken in the boards you have served on, i.e. what committees you have chaired, and highlight your board journey with the various boards you have served on.

Do you need governance education to serve on a board?

A common question among individuals embarking on a board career is whether or not they need to have a formal governance certification or designation (C.Dir or ICD.D). While it provides a valuable base to prepare you for board roles, it is not always a requirement. Your skills/expertise and board governance experience along with your industry knowledge are what boards look for first.

Three Tips on how to enhance your board experience & skills

  1. Demonstrate leadership by joining a committee, and demonstrating your strengths and skills. Try to get on committees and chair committees that are away from your functional area. For example, if you are in finance, try HR or a quality committee to broaden your scope and experience.
  2. Find a topic that you are passionate about and you will engage people in a more meaningful way. You can increase your engagement by going to workshops and seminars where you can connect with others in the same niche.
  3. Stay current with industry trends by reading articles and director’s journals on change management and organizational development. Keep yourself well versed on new management techniques, as it gives you the ability to engage and understand current events and trends.

 

Top 5 Tips to Help You Become Financially Literate to Serve on a Corporate Board

22381136599_5c7a0234e6_b

Every Board member has a financial oversight role. Even if you don’t have financial expertise, you are still expected to have a level of financial literacy. This means that you need to have an understanding of the fundamental concepts, conventions and principles underlying financial statements.

Top 5 tips to help you become financially literate for corporate boards:

  1. Develop a plan and begin the work. Begin by reviewing the annual filings of TSX listed companies that you are interested in.
  2. Look for a mentor or someone who has financial expertise. Ask someone you know that has financial expertise if you can spend time with them over the next year to help you understand financials.
  3. Do your financial due diligence before joining corporate board. Review the annual audited financial statements, quarterly financials, Management, Discussion & Analysis (MD&A) and forecasts/budgets to understand the company’s financial position.
    Ask yourself with the following questions:
    ~Is the company solvent?
    ~Are they complying with their loan covenants?
    ~What is the company’s shareholdings structure, are there Related Party Transactions, what are the outstanding commitments?
    ~What is the status of their tax and other filing requirements?
    ~Did they receive a clean audit opinion? If not, why and is there a “going concern” note disclosure?
  4. Understand the basic financial concepts/principles and the various financial statements. CPA Canada has great document you can refer to: https://www.cpacanada.ca/en/business-and-accounting-resources/financial-and-non-financial-reporting/international-financial-reporting-standards-ifrs/publications/reading-financial-statements-what-do-i-need-to-know-faq
  5. Understand the role of the board, of management and of the auditors in the financial reporting of a Corporation.

Getting financially literate takes time, focus and commitment.

Interested in Becoming Financially Literate? Registration is still open for Women Get On Board’s ‘Understanding Financials for Corporate Boards’ Workshop: http://bit.ly/UFWorkshop2Apr20

Don’t miss a chance to win a Free Board Planning Consultation from Women Get On Board!
Sign up for our mailing list, refer a new member, or become a Women Get On Board member before April 30th, 2016, and be entered automatically into a draw for the chance to win a free Board Planning consultation – a $500 value. Visit www.womengetonboard.ca to sign up, refer or become a member by April 30th, 2016!

 

 

Top 3 Tips for Building Your Board Profile

AKP_PLEX_WGOB_0003

Getting started on your board journey includes building a board profile. So, how does one go about it?  It starts with asking yourself what your value proposition is, and what unique skills and experience you bring to a board.

Here are my 3 tips for helping you build your board profile:

1. Define your unique value proposition

Boards are made up of a diversity of thought with members bringing different culture, experience, gender, ethnicity, age and geographic representation. So, what is it that you can bring to an already diverse board? What is your unique board value proposition?

Think of it like an “elevator pitch” where you have 10 seconds to tell someone what you bring to a board. In my case, I say that I have entrepreneurial and financial expertise with high growth and transformational companies in the technology, retail and consumer sectors.

2. Be true to what you passionate about

You need to pursue organizations that deal with what you are interested in or passionate about. For myself, I am passionate about dance. When I was asked to join Canada’s National Ballet School’s (NBS) Board, they asked me why was I interested in NBS, and I replied, “I always wanted to be a ballet dancer.”

Think about companies outside of your industry experience. It can be very rewarding to leverage your skills in a new industry with a whole new network and community to engage with. After spending over 20 years in the technology industry, I was asked to join a retail board, which made me excited because I love to shop. But, I am also a Canadian consumer so I understood that I could bring that perspective to the Board.

Get involved in your Alma Mater. Begin by serving on committees or councils to reconnect with your university and go back on campus. I started getting involved with Brock University by serving on the Dean’s Advisory Council for the Goodman School of Business, then on the President’s Advisory Council and was then asked to join the Board of Trustees.

3. Research the companies or industries that you are interested in

Review their values, mission and strategy. Do they align with your own skills, experiences and values? Will you add value?

I always evaluate Board opportunities in three ways:

  1. How can I add value?
  2. Do I have a personal statement of the attributes I can bring to the board?
  3. How can I use my network to make meaningful connections to grow the business?

Building your Board profile is an ongoing process that takes time and takes focus. Good luck!

Interested in Getting Board-Ready? Registration is still open for Women Get On Board’s ‘How to get yourself on a Board’ workshop on March 30th:  http://bit.ly/March30Workshop

Don’t miss a chance to win a Free Board Planning Consultation from Women Get On Board!
Sign up for our mailing list, refer a new member, or become a Women Get On Board member before April 30th, 2016, and be entered automatically into a draw for the chance to win a free Board Planning consultation – a $500 value. Visit www.womengetonboard.ca to sign up, refer or become a member by April 30th, 2016!

Preparing for a Board Interview

AKP_PLEX_WGOB_0037
You have been asked to a board interview. Congratulations!  Now that you have landed the interview what do you need to do to prepare? A board interview is similar to job interview in that you want to put your best foot forward. Where board interviews differ is the preparation from a governance point of view rather than from a management viewpoint.

Top ten tips to help you prepare for a board interview

  1. Prepare, prepare, prepare. Like a job interview, you want to come prepared to your
    board interview. Make sure you know what members of the Board you will be meeting with. Know their background, experience and skills. Find out who the independent board members are and what the ratio of executive to non-executive members is.
  2. Gain a strategic understanding of the company. What are the opportunities and challenges that the company is facing? Is the company going through transformational changes, or high-growth through acquisitions?
  3. Research, research, research. Do your due diligence. Go on SEDAR (www.sedar.com) and read the company’s latest annual report, annual proxy circular, quarterly filings and press releases. Also check out the company’s social media and what is trending online about the company.
  4. Know your value proposition. What value-add you will bring to the board? For more information see my blog on Preparing Your Board Resume.
  5. Understand conflicts. Ask for their corporate calendar and make sure it doesn’t conflict with your other current boards — also ensure that you have the time to commit to this board. Are there other conflicts that you have to be concerned with like your current employer, financial or related parties?
  6. Understand the culture of the board. Where do you fit in? Look at the current board composition and their board diversity policy. What would it mean for you if you are being considered to be the “first” woman on the board? Ask questions about your fit. Find out how the board works together. Is it collegial? Does the board evaluate its own performance?
  7. What board committees exist? What committee(s) would you be considered to join?
  8. Know your expected contribution. Why did the company identify you as a board director candidate?
  9. Compensation. Review their board compensation in their annual proxy circular. Is there an expectation to purchase shares?  Is the compensation in line with your expectation? How often do they do a board compensation review?
  10. Practice, Practice, Practice.

If you are interested in learning more about preparing for board interviews and building your board profile, please sign up for Women Get On Board’s How to get yourself on a Board workshop on March 30, 2016: http://bit.ly/March30Workshop .

Refer a new member (or become a Women Get On Board member) before or on International Women’s Day, March 8th, 2016, and be entered into a draw for the chance to win one free ticket to a Women Get On Board workshop of your choice – a $300 value. Email connect@womengetonboard.ca to refer someone or join Women Get On Board by March 8th, 2016!

Preparing Your Board Resume

board table 1

A Board resume is an ongoing, dynamic document. When preparing your Board resume you need to keep it current and keep it fresh. To do this, you need to ask for honest and candid feedback from your own personal advisory board.

Next, you need to decide on whether you will prepare your Board resume on your own or if you will engage a firm to help. Having an outsider’s input can help you hone in on your unique value proposition and help develop what skills you want to highlight. Putting together a Board resume is an important step in any Board journey, and that’s why at Women Get On Board we offer Board resume consultations to our members to help them showcase their Board skills and value proposition.

Preparing your Board resume also requires creativity on your part to really think about what makes you unique and how you stand out from others. As I have mentioned in my previous blog Are You Board-ready?, you have to be mindful that it is a very competitive marketplace. There is an over-supply of qualified corporate directors for a limited supply of available corporate board seats. So, you need to engage your creative mind to think on who you are, what you offer and how you’re going to go to market to let others know that you are looking for a board opportunity in a particular industry/sector and how you can add value.

Your Board resume should be no more two pages. It is a summary of your skills to a Board and highlights your

  • value proposition, i.e. the value add your bring to a Board, your unique offering;
  • skills and expertise;
  • industry-specific knowledge;
  • career accomplishments — highlight your executive and other relevant leadership roles to showcase your understanding of the business, the industry and the broader macro environment to gain the respect and confidence of the current board members;
  • speaking engagements and awards — list areas that you are sought after as an expert or have thought-leadership in, and any awards that recognize you for your accomplishments;
  • current and past Board experience — highlight the committees you have served on and the leadership roles that you have taken, e.g. Chair of a Committee or Chair of the Board.

Preparing your Board resume takes time, creativity, feedback and continuous updating. Good luck!

Please save the dates for our 2016 Getting Board-ready workshops: http://womengetonboard.ca/workshops/

The purpose of the Getting Board-ready workshop series is to help women gain insights and learn about the skills they need to prepare for board opportunities. These half-day workshops will be facilitated by Corporate Directors and governance experts who will provide practical experience to empower women with tools to enhance confidence and courage to lead and serve on boards.

Building Your Board Profile

Board Profile

Getting started on your board journey includes building a board profile. So, how does one go about it?  It starts with asking yourself what your value proposition is, and what unique skills and experience you bring to a board.

(Learn more about How to prepare yourself for Board roles with Women Get On Board’s Getting Board-ready workshops!)

What is your unique value proposition?

Boards are made up of a diversity of thought with members bringing different culture, experience, gender, ethnicity, age and geographic representation. So, what is it that you can bring to an already diverse board? What is your unique board value proposition?

Think of it like an “elevator pitch” where you have 10 seconds to tell someone what you bring to a board. In my case, I say that I have entrepreneurial and financial expertise with high growth and transformational companies in the technology, retail and consumer sectors.

What are you passionate about?

You need to pursue organizations that deal with what you are interested in or passionate about. For myself, I am passionate about dance. When I was asked to join Canada’s National Ballet School’s (NBS) Board, they asked me why was I interested in NBS, and I replied, “I always wanted to be a ballet dancer.”

Think about companies outside of your industry experience. It can be very rewarding to leverage your skills in a new industry with a whole new network and community to engage with. After spending over 20 years in the technology industry, I was asked to join a retail board, which made me excited because I love to shop. But, I am also a Canadian consumer so I understood that I could bring that perspective to the Board.

Get involved in your Alma Mater.  Begin by serving on committees or councils to reconnect with your university and go back on campus. I started getting involved with Brock University by serving on the Dean’s Advisory Council for the Goodman School of Business, then on the President’s Advisory Council and was then asked to join the Board of Trustees.

Research the companies or industries that you are interested in.

Review their values, mission and strategy.  Do they align with your own skills, experiences and values? Will you add value?

I always evaluate Board opportunities in three ways:

  1. How can I add value?
  2. Do I have a personal statement of the attributes I can bring to the board?
  3. How can I use my network to make meaningful connections to grow the business?

What is your personal statement?

A personal statement is like your own personal campaign. Recently, I was referred to a board opportunity and in the interview process I was asked to write about why I would make a difference and what makes me unique. So, I wrote my personal statement on what value I would bring to the board; why I was passionate about the business; and how I would bring a diversity of thought from my 30 years of diverse business experience with an open, creative and strategic way of thinking.

How are you connected to the company?

Joining a board is about fit and style, and the Board wants to make sure that your style will fit in. To help them decide, think about your network and how you might be connected to any one of the Board members. This is what I call “network mapping.” Use your network to map how you might be connected to members of the Board — the more connections you have to the Board the more comfort they can get on how you will fit in. Don’t be afraid to ask for introductions!

I shared my most recent board interview process with someone in my network. And without even asking, they made two great introductions for me to help advance my connection to the company. Some people are natural connectors. If you would like some tips, please my “Are you a connector?” blog post.

Building your Board profile is an ongoing process that takes time and takes focus. Good luck!

If you are interested in Getting Board-ready, please sign up for Women Get On Board workshops: http://womengetonboard.ca/workshops/

The purpose of the Getting Board-ready workshop series is to help women gain insights and learn about the skills they need to prepare for board opportunities. These half-day workshops will be facilitated by Corporate Directors, governance and search experts who will provide practical experience to empower women with tools to enhance confidence and courage to lead and serve on boards.

 

 

How to Prepare Yourself for Board Roles

board table 2

What is the best way to prepare yourself for Board roles?

Executives who want to make the transition to corporate director often need advice on how best to set up and prepare for their board journey. The first step is to understand your role on a board, which I outlined in my previous post here.

Once you have an understanding of your role, begin your Board journey by leading and serving on Not-for-Profit Boards. Getting Involved in Your Community by serving on a Not-for-Profit is a great way to give back and to meet other community business leaders.

Lastly, there are different types of Not-for-Profit boards, so you must do your due diligence to make sure the Not-for-Profit Board is the right fit for you.

Is the Not-For-Profit the Right Fit For You?

  1. Are you passionate about the cause/organization, how can you make a difference?
  2. Is it a fund-raising board? Are you expected to fund-raise and/or donate your own funds to the organization?
  3. What committee on the Board would you bring the most value/contributions to?
  4. What is the term of the Board position, and is it renewable?
  5. What type of Board orientation is available to new board members and ongoing education?
  6. What is the NPO’s financial situation, are they a going-concern?
  7. What type of government/private donor funding do they rely on?
  8. What type of governance structure do they have? Make sure to ask about the by-laws, committee structures, corporate calendar of meetings and work plans for the committees.
  9. Have you met with the CEO or Executive Director of the organization, and do you understand what their challenges/opportunities are and the vision/values of the organization?
  10. Have you met with other current Board members and past Board members?

Asking yourself these top 10 questions before joining a Not-for-Profit Board will help you determine if it is the right fit for you.

Enjoy your Board journey!

If you are interested in Getting Board-ready, please sign up for Women Get On Board workshops: http://womengetonboard.ca/workshops/

The purpose of the Getting Board-ready workshop series is to help women gain insights and learn about the skills they need to prepare for board opportunities. These half-day workshops will be facilitated by Corporate Directors, governance and search experts who will provide practical experience to empower women with tools to enhance confidence and courage to lead and serve on boards.

 

Understanding Your Role on a Board

board table 3
Creative Commons

There are two roles you must play on a Board, one is Oversight and the other is Value-add.  I will highlight both roles with an extract from a chapter that I co-authored with Donna Price in 2008’s Entrepreneurial Effect by James Bowen and Glenn Cheriton, titled Corporate Governance-Directors of Emerging Companies.

(To promote understanding of a director’s role on a board and how to prepare for board opportunities, and as a co-founder of Women Get On Board, I am co-facilitating a series of Getting Board-ready workshops from October to December 2015. Learn more about them here: http://womengetonboard.ca/workshops/.  Hope to see you there!)

The Oversight role on a Board

The primary responsibility of directors is to oversee the management of the business and affairs of a corporation. This is referred to as an oversight duty. As a general matter, a business corporation’s objective in conducting business is to create and increase shareholder value. To this end, in addition to performing an oversight duty, boards also perform a value-added role. Decision-making generally involves developing corporate policy and strategic goals with management and taking actions on specific matters related to those policies and goals. Other matters, such as changes in the charter documents, election of officers, (and other matters referred to above), require board action (and sometimes shareholder action) as a matter of law.

All directors must understand that decision-making and oversight responsibilities come from prescribed standards of duty and conduct.

The corporate statutes impose two principal duties on directors: A fiduciary duty and a duty of care. As fiduciaries, directors have an obligation to act honestly and in good faith with a view to the best interests of the corporation.

As a director, you must exercise the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances. This is known as the duty of care. In discharging the duty of care, a director must be concerned about process at least as much as, and perhaps more than, the actual decision taken. The duty of care underscores the need to implement corporate governance procedures to guide the board in decision-making. This means that pre-meeting, meeting and post-meeting practices should be oriented to providing the right information within a timeframe that will permit diligent discussion and decision. If a board makes a decision that may be contentious from a business perspective, provided the board gave sufficient thought and consideration to the decisions and were otherwise diligent, it will not normally be criticized. This is sometimes referred to as the “business judgment rule” and generally speaking, courts will not substitute court judgment for the business judgment of the board.

The Value-Add Role on a Board

In the formative years of an emerging company, the director’s role is more often weighted to a value-add role and as the company matures the role becomes more weighted to an oversight role.

Keeping in mind that the overall role of the board is to maximize shareholder value, directors also provide a level of insight, business acumen and personal network that extends beyond the company’s management team. These are some of the components that contribute to a director’s value-added performance.

The collective board should have sufficient industry knowledge and domain expertise (such as technical, operational or governance) in order to add value to board decisions and strategic priorities. Paramount to their duties, directors must select and oversee the CEO and monitor company performance. A value-added board should provide insight, advice and support to the CEO and management on key decisions and issues confronting the emerging company. Caution: “Nose in, Fingers out!” Boards must balance being too engaged in the day-to-day operations, with performing an oversight role.

Please join us for the Getting Board-ready Workshop Series from Women Get On Board 

The purpose of the Getting Board-ready workshop series is to help women gain insights and learn about the skills they need to prepare for board opportunities. These half-day workshops will be facilitated by Corporate Directors, governance and search experts who will provide practical experience to empower women with tools to enhance confidence and courage to lead and serve on boards. http://womengetonboard.ca/workshops/.