Most reputable companies want to comply with good corporate governance and hence, among other things, do an annual board evaluation. The national codes typically state that the effectiveness of each board member should also be evaluated. However, boards often avoid tackling this part of the evaluation because board members – like everyone else – can feel some insecurity about being personally evaluated. Also, there is uncertainty about how to carry out such a sensitive analysis.
Boards and companies should consider the idea that to maximize overall board effectiveness, each board member can benefit from becoming aware of how their strengths and contributions are perceived by the other board members and executives. One way to get this information is to conduct individual evaluations simultaneously with the overall board evaluation.
The individual evaluation could provide an anonymized overview of how board colleagues, selected executives, and other relevant key stakeholders perceive each other’s value contribution and key strengths in a board context. It can be an elementary analysis or more advanced. The evaluation can include a set of evaluation criteria along with open-ended questions.
The setup should be controlled so that the findings are only shared with the individual and the Chair, so that no board member can see who said what about them, and that only the Chair has access to all individual reports.
The benefits of adding such a module to your annual evaluation are that each individual gets a better understanding of how they are perceived to create value for the board, and that the board overall gets a better collective understanding of where it performs well and where it might do better.
Leadership Advisor Group has developed a special version of the individual evaluation as an extra module used in many board evaluations. Public discussion about diversity at the board level is usually focused only on gender and nationality. Still, our analysis goes deeper and covers the board’s cognitive diversity. Based on respondents' input, each board member gets a feedback report telling them how others perceive their personal style, areas of expertise, and ability to manage the board role effectively in relation to stakeholders. With this input, each individual gets the opportunity to see their strengths and development areas in the context of their colleagues (in an anonymous format) and can measure their progress over time if the module is used annually or regularly. Additionally, all respondents see the aggregated average results, i.e., what this board has as a collective strength and what areas it could consider developing further. We’d happily take you through this evaluation module if your board is interested.
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Interested in self-evaluation? Try Online Board Evaluations
Well-aligned with national corporate and foundation/charity governance codes, our board clients usually conduct an external board evaluation every three years. However, most national governance codes recommend that boards perform a self-evaluation in the years between external board evaluations. Therefore, we have developed OnlineBoardEvaluations.com, a tool enabling boards to self-evaluate effectively and effortlessly every year.
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