The Savvy Director Blog

How much information is enough for a board to make a decision with impact?

The best boards can make decisions without perfect information. Waiting for perfect information often results in a missed opportunity. Analysis paralysis is a description applied to the inability to make a timely decision while waiting for more and more data. I’d like to suggest that it’s just an excuse to procrastinate. (I’ve been there.)

For board directors, the good news is they don’t have...

The board governance landscape continues to evolve around us, making the role of internal audit more important than ever. As a board director, whether the organization you serve is a large for-profit corporation or a local non-profit, internal audit’s insight and assurance is an indispensable resource to help you fulfill your role.

Essentially, internal audit serves as the board’s eyes and ears. It answers the key oversight question, “How do we know?” by providing an...

Many of the problems that boards are faced with involve decision making under uncertainty. Rarely do we have the kind of perfect information that would allow us to predict with complete confidence what the outcome of our decision will be. Most of the time, it’s impossible to know that the facts we’re relying on are 100% certain.

To help decision makers reduce the uncertainty of the information at hand, business schools teach graduate courses on assigning probabilities to decision...

As I write this week from the northern hemisphere, the fall season is on its way. That means the start of a new governance year for many of us — including new board members who’ve just been recruited and appointed to a board of directors.

Whether you’re a wily veteran or a newcomer to board work, your first board meeting with a new board is a crucial opportunity to establish your credibility and build relationships with fellow directors.

“What will the first board...

Last week’s blog dealt with board succession. If you read that post (A Better Way to Fill Board Seats), then you know I’m an advocate of treating board succession as an ongoing process of planned renewal.

Maybe you also noticed that we glossed over the whole topic of actually selecting the right director for your board – a process that is complicated enough to merit its own separate blog post.

So, let’s delve into the topic of board recruitment now.

Pinpointing...

Does this sound familiar?

A long-standing, knowledgeable and well-respected director will soon be stepping off your board. This will create a vacant board seat.

Once the board becomes aware of this impending departure, a board committee is tasked with finding a good candidate to fill the seat. The committee scrambles to interview a few candidates and recommend one of them to the board.

The board rubber stamps the committee recommendation and – bingo! – there’s a new board...

I’m often asked about CEO evaluations. I’ve helped boards with everything from developing a process, to designing the method, to gathering and analyzing information, and even communicating the results.

I’m a strong proponent of conducting an annual CEO evaluation. For one thing, it’s the board’s job to do so. The board-CEO relationship is an important one and an effective evaluation process can help strengthen it.

It’s hard for any CEO to get honest...

Once you’ve established yourself as a director on one board, you may very well find that you’re being approached to serve on one or more additional boards.

Is saying “yes” a good idea? What should you think about before deciding? And what is the ideal number of boards to serve on?

As so often with the topics we explore in The Savvy Director, the answer is, “It depends.” In this case, it depends on some very personal considerations, such as the stage...

At its core, a board of directors is the ultimate decision-making body for an organization. The board’s ability to make sound decisions based on consideration of reliable facts, coupled with the good judgment of its individual members, is a key element of organizational success.

That makes it important to understand the factors that lead to good decision-making as well as those that detract from it. One risk to good decision-making is what’s known as decision fatigue. The term...