Boards often focus their most of their time and efforts on activities related to regulatory compliance and risk oversight, which helps preserve existing shareholder value. Increasingly, however, shareholders expect CEOs and boards to spend more time on long-term value creation activities.
This document explores select frameworks, models and tools that can help:
• build an effective, strategic and value-driven board
• measure current board engagement against a desired level, and
• develop an effective board evaluation
A supplementary self-explanatory Excel worksheet to help graph current and desired board engagement levels is also included. Only the "Current Level" and "Desired Level" columns need to be filled using the drop down list, with cells left blank for "Not applicable/Don't know".
Contents
1. Context and overview
• Context
• Primary parties to corporate relations
• Corporate governance stakeholders
• Corporate governance vs corporate management
2. Leadership versus management
• Leadership versus management
• Leadership and management requirements
• Role of chairman versus role of CEO
3. Building an effective board
• Overview of the board's role
• Board-building framework
• The board as a source of competitive advantage
• The contingent role of boards
4. Boards and strategy
• Multiple strategy approaches
• The board's contribution to strategy
• The board's changing levels of contribution to strategy
• The impact of context on a board's role and strategic views
• Corporate strategy tasks and roles
• Engaging the board in strategic planning
• How forward-looking boards should spend their time
5. Governance as Leadership
• Governance as Leadership
• Three governance modes
• Overlapping modes of governing
• Four quadrants of engagement
• The generative curve
6. Value-creation
• Tricker model
• Tricker model ? detailed
• Tricker model ? current versus desired
• Four pre-conditions to value-added board governance
• Value focused board governance
7. Board engagement
• Degree of board involvement
• The engaged board
• Measuring board engagement ? potential engagement areas
• Measuring board engagement ? illustrative outcome
8. Board evaluation
• A framework used for board evaluations
• Step 1 – What are our objectives?
• Step 2 – Who will be evaluated?
• Step 3 – What will be evaluated?
• Corporate Governance Practice Framework
• High performance board model
• Step 4 – Who will be asked?
• Step 5 – What techniques will be used?
• Board evaluation methodologies
• Step 6 – Who will do the evaluation?
• Step 7 – What will you do with the results?
The PPT emphasizes the importance of aligning corporate governance with strategic management to enhance accountability and supervision. It provides a comprehensive analysis of the roles and requirements of leadership versus management in various business environments.
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Source: Best Practices in Value Creation, Board of Directors PowerPoint Slides: Value-Driven Boards - Frameworks, Models and Tools PowerPoint (PPTX) Presentation Slide Deck, ILMAM - Strategy & Management Consulting
This PPT slide titled "Value-Driven Boards" outlines a structured framework for conducting board evaluations. It presents 7 critical questions that guide the evaluation process, ensuring that all relevant aspects are considered.
The first question, "What are our objectives?" emphasizes the importance of defining clear goals for the evaluation. This sets the stage for the entire process, as objectives will shape the subsequent steps. The second question, "Who will be evaluated?" addresses the specific individuals or groups that will undergo assessment, which is crucial for accountability and clarity.
Next, "What will be evaluated?" focuses on the criteria or areas of performance that need assessment. This could range from governance practices to individual contributions. The fourth question, "Who will be asked?" highlights the need to identify stakeholders or participants whose input will be valuable in the evaluation. This ensures a comprehensive perspective.
The fifth question, "What techniques will be used?" pertains to the methodologies or tools that will facilitate the evaluation process. This could involve surveys, interviews, or other assessment methods. The sixth question, "Who will do the evaluation?" is about designating individuals or teams responsible for carrying out the evaluation, which is vital for maintaining objectivity.
Finally, "What will you do with the results?" underscores the importance of actionable insights. It prompts organizations to consider how they will implement findings to drive improvements. The note at the bottom indicates that while these steps are presented linearly, they may not always follow that order in practice, suggesting flexibility in the approach. This framework serves as a comprehensive guide for organizations aiming to enhance their board effectiveness.
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