Directors Ask:  Do I really need to read all this stuff?

Question:  Every month, I get a 70-page board packet with a “supplemental’ packet of 170 pages. Do I REALLY need to read all this stuff?

Answer:  Yes, at least once.

The inconvenient truth is that for most nonprofit directors, the first time they open their board book is when the meeting is called to order.  Board officers must understand that their directors’ time is a scarce resource, and few people, even those with the greatest commitment to the agency’s mission, feel that thumbing through a massive board book filled with documents they don’t understand is a good use of their time.  That means most directors arrive at the board meeting not having done any preparation and not ready to discuss the issues on the agenda. 

On the other hand, directors are probably legally responsible for knowledge of the contents of their board books.  Think of the dialogue between the government investigator and the board member:

Investigator: “You were advised repeatedly in your board packet that [something terribly illegal] was occurring within your organization.”

Board member: “Perhaps, but I never look at my board packet. It is too voluminous.”

But why are Board packets so Large?

While the distribution of board packets is a way of preparing for the board meeting, it is also one of the primary methods by which management communicates with the board about the corporation’s status, finances and operations.  Board packets often contain a large number of informational items and reports.  Most of this material will not be discussed at the meeting.  While interesting, inspirational, and educational, it can be a distraction from the matter at hand – a meeting of the agency’s governing body.

This dual purpose is one reason board packets have swollen, but there are others:

No time for summaries.

It is easier to insert in a board packet a 35-page document that directors will never read as opposed to a two-page summary, written in language a director can understand, that has a fighting chance of being read.  These original documents are usually prepared for some other internal or external purpose and are filled with technical jargon and acronyms.  Already drafted and final, they are very easy to drop into the board packet, but they will usually provide a level of detail much greater than the directors will find useful.

Plausible deniability.

In organizations where there is a lack of trust between the board and the CEO, large board packets can be viewed as an act of self-defense.  Unfortunately, during a crisis, the CEO can hear, “Why weren’t we told?” as in, “Why weren’t we told we could have a cash crisis?”  With the reply, as equally unhelpful as the question, “Every month you receive the financials, and by comparing line 15 on each balance sheet, you could have seen that our cash position was declining.”  If that is why your packet is so big, you have much more significant issues to confront than the need to streamline your packets.

Presentations, two ways.

Many boards encourage staff presentations at their meetings.  It’s a great way to introduce staff members to the directors and reaffirm the board’s admiration for the agency’s work.  These can be nerve-wracking events for the staff members not used to presenting to the board.  To prepare, the employee usually pulls together a PowerPoint presentation on which the employee will rely and from which the employee will read at the meeting.  That presentation usually works its way into the board packet.     But how often do professional presenters distribute their presentations in advance?  Rarely, because they want their audience to listen and not be reading.   Most great presenters know that slide shows are supplemental to the talk being given and may contain slides that are incomprehensible without the accompanying verbal explanation.  Perhaps a summary in the board packet would be preferable.  Most 25-slide PowerPoints can be distilled down to one or two pages of text, and the PowerPoint software can create an outline that can be a pretty good start at the summary.  Or there is how professional presenters handle this – “If anyone would like a copy of my presentation, please let me know…”

A Useful Exercise and a Reality Check.

To improve, boards need to be honest with themselves, no matter how painful the conversation can be.  So let’s start with an anonymous survey.  Some boards have a mechanism to conduct confidential surveys of their board electronically, but any board can pass out this two-question survey at the end of its next board meeting:

Q 1: Did you review the board packet before today’s meeting?  Yes/No

Q 2:  If “Yes,” approximately how long was your review?   _____________ minutes.

Of course, we’d like to know more – what did they find useful?  Was the packet easy to read?  Did it highlight the key actions the board would be asked to take or the key policy issues to be discussed?  All those can be explored later, perhaps in a different process, but for now, let’s confirm our starting point.

What SHOULD be included in the board packet or otherwise distributed to the board?

That question is a bit more complicated and will be the subject of a future blog.  In the meantime, let’s get our board packet PROCESS fixed in four steps:

  1. Let’s get directors committed to reading the board packet or at least a comprehensive “executive” summary of its contents.
  2. In exchange, the Executive and Board leadership should commit to keeping the parts of the board packet that all directors are expected to read under a set number of pages. 
  3. As equally important as a slimmed-down packet is a packet that is clear and easy to navigate.  Many boards use a cover letter from the CEO or Board Chair highlighting expected board “action items” and significant discussion topics.  That letter can point the directors to the parts of the packet that need their special attention before the meeting. 
  4. But what about all those pages and pages of operational reports, copies of minutes from various staff committees, interesting and informative articles, highlights of community projects, etc., etc., etc.?  Find another way to get this content to your directors at a time and in a format that it might be read and appreciated. 

So SHOULD directors review the entire board packet?

Directors should not come to a meeting “cold” and asking directors to spend an hour reviewing the board packet in advance of the meeting is not an unreasonable expectation.  But board packets should be thoughtfully prepared following some basic rules:

  1. Boards should establish guidelines to standardize their packet size and format with the expectation that directors will review the material in advance of the meeting.
  2. By including annotated agendas and executive summaries the packet should direct the reader to the most important information and highlight any topic upon which the board will be asked to act.
  3. Oral board presentations should discuss the most important documents in the packet.
  4. Packets should not be a dump of information that has been prepared for some other purpose and when these documents must be included for regulatory purposes they should come with a written summary.