Streamlining the Work of the Board

Most of the directors on not-for-profit (NFP) boards are unpaid. Many have full-time jobs, other directorships and family obligations. Putting the time they donate to good use is respectful as well as beneficial to the organisation.

“Some boards waste a lot of time on management issues so directors must be very clear about their role and where their responsibilities end”, says Sallie Saunders, Principal Consultant with Building Better Boards and an experienced board member. “The agenda should be tight and well-structured and the chair should ensure that meetings don’t run on too long. I also think all boards should adopt the technology that is now available to streamline boardroom operations.”

Rainer Jozeps has held senior roles in some of Australia’s leading cultural and charitable institutions. In his executive positions he found he was spending at least one week in every four preparing papers for the approaching board meeting.

“If there are 10 meetings a year that’s 10 weeks spent on servicing the board rather than doing the important work of pursuing the organisation’s strategies and objectives,” he says.

He and his wife Kate Gould, a director of the Adelaide Football Club, used their own experiences to create the Our Cat Herder board portal specifically for NFPs.

“We estimate that this technology can reduce preparation time from a week to two or three days,” he says.

Electronic collaboration

A board portal is simply software that allows directors to collaborate and share information electronically.

“Board portals provide a sophisticated and secure alternative to paper-based systems,” says Klaus Zimmerman AM, an experienced chairman and director who received the Order of Australia for services to the aged care sector. “Putting everything online saves significant cost and time for the organisation. Directors also have easy access to past papers as well as libraries of information which can be managed centrally and kept up-to-date at all times.”

Jozeps remembers the disruption of someone having to leave a board meeting to search for a vital document.

“Directors often need to refer to strategic plans, policies, procedures and guidelines,” he says. “When you have them at your fingertips meetings can be run much more efficiently. An iPad or laptop is also much easier to carry than one or more heavy board packs.”

The online environment is also very transparent.

“All of the directors can see if any changes have been made to the minutes or any other papers,” says Saunders. “I also recommend the online financial management systems that allow all board members to check how the organisation is performing at any time.”

Our Cat Herder includes an Action Tracker, which records every action agreed in the boardroom.

“This can be very motivating for directors who have volunteered to do something like arrange a fund-raising event,” says Jozeps.”It also provides information that can help the board in their evaluation of the chief executive officer (CEO).”

A secure, Noticeboard function promotes discussion between meetings.

“This enables directors to cut to the chase when they get together in the boardroom,” says Jozeps.

More succinct board papers

Boards receive much of the information required for decision-making in board papers.

“Well-written papers enable directors to focus on things that matter and not be side-tracked by inconsequential details,” says Mary Morel, director of The M Factor and author of Write to Govern: How to Write Effective Board Papers. “They not only save time, they are essential to help directors meet their fiduciary duties.”

A study by Board Intelligence in the United Kingdom found that 84 per cent of directors wanted their board papers to be more succinct.

“Modern board and committee templates encourage writers to get to the point, provide information in a consistent format and prepare papers that get through the review process more easily,” says Morel. “Unfortunately, the boards of some small organisations don’t have templates at all, while others have templates that are very old-fashioned or have so many headings they distract from overall structure and flow. I believe that board portals are the way of the future, so board papers also need to be adapted to this medium. For example, the recommendation and any decision taken should be at the top rather than the end because that’s what directors want to know immediately, particularly when they’re reading online.”

A more secure option

Some directors are suspicious of boardroom technology because of a perceived lack of security.

“Tightened legislation has certainly made security an important issue for NFP boards but it’s wrong to assume that paper is safer,” says Saunders. “Printing out the minutes and the financials and leaving them lying around your workplace or a hotel room does not qualify as good records management. Confidentiality is much easier to maintain when all your materials are held in a password-protected online portal.”

However, directors do need to understand the risk profile of the organisation and where vulnerabilities might lie.

“Most organisations now rely heavily on electronic systems in just about every aspect of their business so it’s vital that appropriate steps are taken to ensure safety and security,” says Zimmerman. “Directors also need to be aware of their public profile and any security issues that might apply to them as individuals. Clearly social media plays an important role and the board must be confident that there are clear guidelines and policies in place to govern their use.”

Confidentiality must also extend to the minutes.

“Many organisations, particularly the smaller ones, believe they have to make the minutes publicly available,” says Saunders. “Social media make this very easy to do but, while the constitution might state that members have a right to review the minutes, strict conditions usually apply. For example, the member may have to attend the office of the organisation to see the portion in which they have an interest or about which they have a question. In fact, recent changes to the NSW Incorporated Associations Act (2016) clarify this. The board may also refuse to permit a member to inspect or obtain a copy of the records of the association that relate to personal, confidential, employment, commercial or legal matters or where to do so may be prejudicial to the interests of the association.”

Virtual meetings

Virtual meeting can reduce directors’ travel time and enable the board to select directors from anywhere in Australia or even overseas. However, they need to be very well managed and the limitations of affordable technology can be frustrating.

“There are often technical issues that disrupt or truncate the call,” says Zimmerman. “It’s also important that, when you’re together in a room, body language and other important inputs can be taken into account. So, while virtual meetings are helpful in certain circumstance, face-to-face is definitely the preferred option.”

Impartial advice

NFPs might baulk at the idea of spending money on technology but, as long as it is carefully chosen, the cost savings will invariably outweigh the investment.

“Even something as simple as sending out an electronic newsletter eliminates the cost of printing and postage, as well being less wasteful from an environmental point of view,” says Saunders.

While some boards remain resistant to technology others are just unsure how to start.

“It helps to have an information technology (IT) champion on the board who can introduce and explain technology to the other directors,” says Saunders. “IT training could also be provided as one of the intangible rewards of serving on an NFP board.”

She suggests approaching university computer science departments as some provide a free advisory service for small and medium NFPs.

“For example, The University of Technology Sydney, where I was an academic, has a community university interface known as Shopfront,” she says. “Students can get course credits for working on your projects under supervision and you can also ask them to evaluate various alternatives and get an unbiased opinion.”

Saunders also recommends the organisation provides directors with a home internet connection and a laptop or tablet for the length of their tenure.

“It’s good practice to ensure that everyone on the board has the knowledge and access to the technology that will enable them to do the best possible job for the organisation,” she says.