The Board Pack Problem

With some 70 metres, 58 scenes, 623 human figures and 202 horses, by any measure the Bayeux Tapestry is a long document. But it’s a masterpiece of communication, as well as craftsman (craftswoman?)-ship, because every panel moves the story forward and the brief Latin captions tell you what you are looking at.

We’re not suggesting that reports and papers should be presented as embroidery, but it’s clear that some business communications are still problematic and sometimes even hinder effective operations. Ask many directors what makes a board effective and the answer, increasingly, is not about structure or skills but is about information.

Research published earlier this year by the EY Center for Board Matters, drawn from a survey of more than 100 directors and interviews with experienced board leaders, found that 72% named the quality and flow of information from management as one of the top three drivers of board effectiveness. Board culture came second, at 62%.

As well as wanting an improved quality of information, directors also want to see more time and better information on different subjects, and these subjects have shifted sharply in the past twelve months. Artificial intelligence and emerging technology now rank first, followed by talent and global political risk. A year earlier, cybersecurity and data privacy ranked above talent, and sustainability featured more prominently. Sustainability is now the only topic where a meaningful minority (16%) say their board spends too much time on it.

Fewer than one in 20 directors said they received too much information on any priority topic, indeed most directors complain that they receive such large packs that they cannot identify actionability: ie. board packs don’t separate signal from noise. Directors who rated their own information flows highly pointed to one thing above all — clarity about where board input or approval is genuinely required.

All of the findings reported by EY replicate what our colleagues in Altair Directors are seeing when they fulfil their own responsibilities as independent directors. In some instances, they are presented with packs that are hundreds of pages long at very short notice before the scheduled meeting and as consummate professionals, they will take the necessary time to plough through the whole pack and make sure they understand and have time to consider the key points and issues.

However, a few actions would help board effectiveness enormously and would be a way for the administrator producing the pack to demonstrate a higher level of client service:

• A corporate governance calendar to allow everyone to plan ahead;
• A contents page that follows the meeting agenda;
• An executive summary or list of key points for each report / paper that notes where an item is for approval, discussion or information;
• Packs circulated in good time according to fixed and enforced deadlines;
• Any changes made to reports / papers in subsequent versions of the pack clearly highlighted;
• Use of agreed dashboards, reporting relevant information consistently with trend information;
• Pruning of superfluous information to ensure that packs are focused on what boards need to know;
• Relevant personnel attending meetings to speak about their key points and answer any questions arising;
• Ask board members what information they do (and don’t) want to receive; and 
• Short updates to board members between meetings on key matters.

Board members must be satisfied that the board pack contains the information they require so they can be satisfied that required corporate governance standards are being met.

We recognise that producing a quality and targeted board pack requires time and thought, and that for a fund administrator to do this for dozens (if not hundreds) of boards when under significant resourcing pressure, is a real challenge.

Obviously it’s important that fund administrator teams should be resourced appropriately but there are also a range of tools available that can help – whether with scheduling meetings, circulating packs, producing minutes – and hence free up time for personnel to focus on the work that really matters and adds value. (Our Beacon GRC tool is well worth a look if you’re considering a tech solution.)

A top-quality board pack is a strong indicator of excellent client service and can set an administrator apart from its competitors. It is a powerful tool in enabling boards to operate effectively and directors to fulfil their responsibilities. It is, therefore, important to take the time to plan and formulate the content of each pack.