Never Throw Red Meat on the Board Table

Boards need advance preparation to fully address complex issues.

 

by Dan Busby and John Pearson

 

When time isn’t taken for precise motion clarity,
there can be several different perceptions
of what is really being discussed
and nobody knows exactly what will show up
in the official minutes.[1]

Cathy Leimbach

 

One of the easiest boardroom time-wasters to fix is also one of the most common, and unnecessary. It is something akin to throwing red meat on the board table.

In this time-wasting scenario, the CEO brings a tough issue to the board without a written recommendation for board action—in fact, there is no recommendation at all, written or unwritten.

So the board starts with a blank page on this particular issue. After a lengthy discussion of all the options, a motion is finally floated. There is more discussion. Then the motion is withdrawn, and another motion is offered. Amendments follow, and with some discomfort, the board finally approves a resolution. Or, after all this work, the board refers the matter to the executive committee for more study before implementation.

The final action more closely resembled a gerrymandered political map than a finely tuned resolution. So sad—and unnecessary.

By starting from scratch, the process consumes 90 minutes of the board meeting—perhaps double the time that might have been spent if the board had started with a well-thought-out recommendation and a draft of a resolution.

Rather than red meat on the boardroom table, boards want, need, and prefer that the “cooking” has already begun. If a board must create its own starting point on a significant agenda item, it can be a very painful process that ultimately diminishes productivity.

Without adequate advance preparation to fully address an issue, boards tend to function as a committee of the whole, often resorting to painfully circuitous discussion. It can result in floating a resolution only to have it amended multiple times while the boardroom clock continues to tick, tick, tick.

Here is the really big danger: A board that starts from scratch on a major issue may reach a somewhat different conclusion compared to starting with a thoughtfully-crafted resolution. And, the ultimate motion adopted is often not as robust as what would have been passed if the board had begun at a strong starting point.

There is a better way. It may be a regular meeting or a specially called meeting. In either case, the key players are the board chair and the CEO working together to prepare the board meeting topic.

Many board issues are routine. Other issues are so complex that they require wisdom and discernment to decide how to properly prepare them for the board. In most of these situations, the staff is well qualified to draft the resolutions with review by the board chair.

Here is the key principle: Always submit recommended resolutions to the board for every action item. The draft of each resolution should be carefully prepared.

Wordsmithing resolutions in a calm, pressure-free environment before a board meeting can be challenging enough. But writing a resolution on a complex topic from scratch in a board meeting with the clock ticking can be a significant challenge. Even if the draft resolution is amended, the final version will probably include much of the carefully crafted language from the draft.

Accompanying every draft resolution should be an appro­priate preamble to provide the context for each resolution. While the board may amend the resolution or fail to adopt it, a well-prepared preamble and resolution will provide clarity to the issue and will often save the board significant time. The inclusion of a preamble with a motion will serve the board well. When a motion is reviewed years later, the preamble helps explain why the board adopted the resolution.

Here is an example of a draft resolution with preamble that ties into the ministry’s Board Policies Manual:

Whereas it is desirable to enhance the responsibilities of the audit committee to require at least an annual meeting with the ministry’s independent auditors,

Resolved that the following text shall be added to section 3.7.3 of the Board Policies Manual: “The audit committee shall also meet with the organization’s independent auditors at least once a year; for at least a portion of the meeting, all members of the staff shall be excused from the proceedings.”

David Wills, President Emeritus of the National Christian Foundation, suggests,

. . . shoot for the “no surprises” standard. The organizational leader and the board chair should have a roadmap several weeks before the next meeting. This will allow for content to be delivered in such a manner that the discernment process begins well before the meeting. Let the board know in advance what decisions are required so they are prepared to make wise ones. Point them to the critical sections of the board material. In some circumstances, calls and meetings may be needed to prepare the board for maximum discernment.

Red meat is raw meat. The meat you serve your board should be well done . . . in advance![2]

Thinking of saving time with a virtual board meeting? Then note this: The importance of advance preparation increases exponentially for virtual board meetings. Introducing an important agenda topic with a blank page is unthinkable for a complex issue, especially in a virtual setting where communication between board members is even more challenging.

 

BOARDROOM LESSON
_______________________________

Adequate advance preparation of resolutions
for board consideration will contribute positively
to effective, efficient board deliberations and actions.

  Board Action Steps:

  1. Reflect: Review the advance board materials for the last few board meetings.
  2. Improve: Determine if advance preparations for board actions could have been improved.
  3. Act: Commit to prepare advance drafts of resolutions to corresond with every recommended action.

 

Prayer

Lord, may our board meeting preparations
enhance the work we do for You. Amen.

 

 

 

[1] Cathy Leimbach, “Wording Motions in Advance,” Posted March 10, 2017. Agon Leadership blog: https://www.agonleadership.com/single-post/2012/07/03/Wording-Motions-in-Advance.

[2] David Wills, “Never Throw Red Meat on the Board Table,” Lessons From the Nonprofit Boardroom (blog), March 28, 2018, http://nonprofitboardroom. blogspot.com/2018/03/lesson-19-never-throw-red-meat-on-board.html.
 

From Lessons From the Nonprfit Boardroom: 40 Insights for Better Board Meetings, 2018, www.ECFA.org/KnowledgeCenter.


This text is provided with the understanding that ECFA is not rendering legal, accounting, or other professional advice or service. Professional advice on specific issues should be sought from an accountant, lawyer, or other professional.

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