Is your Board fit for purpose?

Posted on 8th February 2018 by Alexis Outram -  What's trending?


Image to represent Is your Board fit for purpose?

It seems gone are the days of Boards being made up of old retainers, those with time on their hands or with good intentions. Today the process of recruiting or appointing a new Board member is often more rigorous and challenging as that of recruiting new members of staff.  The reason for this is that organisations not only face increased compliance and reporting but also there are greater demands on the Board to ensure the sustainability and viability of the organisation they are involved with. 

Certainly gone are the days of Board members turning up to a Board meeting unprepared, with little to say enjoying a nice lunch. In fact for many today, the prep is often a few hours the day before reading papers and lunch has probably been replaced by a biscuit, fruit or similar snack.

In part the growing trend towards more dynamic Boards is down to the need to have the extra layer or tier of input and direction for the organisations from those not often full time employees or directors.  Board members should and do bring additional specialisms, expertise and professionalism to the organisation, often from individuals who the organisation could not afford or justify to employ full time, but that in either an unremunerated or remunerated role adds significant value to the entity.

With the correct mix of members, a Board’s role and responsibilities range from setting strategic direction through to ensuring attainment of the same. The Board, with its  diverse skills set,  also needs to ensure good governance and compliance, checking the same and holding to account as well as challenging those  responsible and accountable for the organisation’s activities.

To be truly effective, Board members should have a genuine interest, enthusiasm and even passion for the organisation. However this should not create too great an emotional tie that it impacts on the clarity of or rationale for decision making. Transparency amongst Board members and others in the organisation is also essential  to ensure realisation of any shared vision and the effective ability to deal with challenges along the way.

With greater demands on Board members, often over and above attendance at Board meetings,   those thinking of taking on a Board role  need to ensure they  have time, commitment, even resolve to  discharge their duties.  Whilst the benefit of a professional qualification or management discipline or comparable day job  can be an asset,  all Board members to be effective need to  have or develop a meaningful understanding of the  many facets of running an organisation.

It seems that more and more organisations are reviewing the makeup and effectiveness of their Board, a process which often starts with a discussion about role and terms of reference. The next stage is then to focus on the skills and experience sought of Board members, with a review of what is already in place.

Invariably the exercise gives rise to the need to look at replenishing the Board, with the likely need for the introduction of a recruitment process and term of office for all new members. Success in the re-organisation of a Board often presents or reveals itself in its vibrancy and vigour, along with the advancement of the organisation.


No Advice

The content produced and presented by Streets is for general guidance and informational purposes only. It should not be construed as legal, tax, investment, financial or other advice. Furthermore, it should not be considered a recommendation or an offer to sell, or a solicitation of any offer to buy any securities or other form of financial asset. The information provided by Streets is of a general nature and is not specific for any individual or entity. Appropriate and tailored advice or independent research should be obtained before making any such decisions. Streets does not accept any liability for any loss or damage which is incurred from you acting or not acting as a result of obtaining Streets' visual or audible content.

Information

The content used by Streets has been obtained from or is based on sources that we believe to be accurate and reliable. Although reasonable care has been taken in gathering the necessary information, we cannot guarantee the accuracy or completeness of any information we publish and we accept no liability for any errors or omissions in material. You should always seek specific advice prior to making any investment, legal or tax decisions.


Expert insight and news straight
to your inbox

Related Articles


How do you avoid financial forecasting that ends up with rain instead of sunshine?

Financial forecasting can often feel like the weather forecast, financial predictions not always being as rosy as planned, or in many cases, as hoped - a bit like the weather whilst sunshine is predicted rain all too often can be the outcome.  Whilst many businesses will look to ...


Working Capital Cycle

The longer the working capital cycle, the more time it takes for your business to get a robust cash flow. It’s good practice for businesses to manage their cycle by looking at each step where possible. This could be by selling stock or product quicker, collecting monies owed ...


Payrolling of benefits in kind to become mandatory

HMRC has announced that from April 2026 the reporting and paying of Income Tax and National Insurance Contributions (NICs) arising on benefits in kind provided to employees, must be collected through the employers payroll. What is the current position? Currently, taxable benefits and expenses must be reported to ...


You might also be interested in...