Boardroom Meeting Best Practice | Complete Guide to Run Board Meeting |
Boardroom Meeting Best Practices
When it comes to holding a boardroom meeting, there are many factors to consider.
If you’ve never taken part in a boardroom meeting before, you may have a question or two about how these meetings are structured.
These meetings are some of the most important dates in the calendar of any organization. However, they can seem intimidating if you are not used to the format. That being said, with the right research and forethought, you can go into any board meeting with a better idea of what you should expect.
Within this article, we’ll be covering a few important topics. These include:
- What is a boardroom meeting?
- The physical requirements for a boardroom
- How to prepare for a board meeting
- How to run a board meeting
We’ll also be answering some of the most common board meeting-related questions.
If you’d like to know more, check out the rest of the article below.
What is a boardroom meeting?
Boardroom definition: a boardroom is a place where elected shareholders conduct their meetings and manage the company.
Some people confuse the terms board room or boardroom. In this instance, the latter is the correct spelling, although both mean the same thing.
In these meetings, the board will usually decide the direction in which they should take the company and handle any issues that need addressing.
However, in investment banking, a boardroom is also where stock brokerages host clients and other people unassociated with the company in investment banking. They will usually meet registered representatives to discuss potential investments and stock quotes and make trades.
While a boardroom meeting takes place in a physical boardroom, many take place over the internet. These virtual board meetings are more convenient, reduce travel time and costs, enhance overall governance and increase the potential for diversity among board members. This has been more commonplace since restrictions on face-to-face meetings were introduced due to COVID-19.
What are the requirements for a boardroom?
As you may already be aware, many big decisions are agreed upon during a boardroom meeting. If the company is large enough, these decisions will affect the company on every level, from employees to investors, even the broader economy. But while these rooms are the forum for these company-defining decisions, they do not need to be particularly special.
Most boardrooms are the same as every other conference room. They only need enough chairs to seat every board member, as well as a table that lets you spread out any notes without encroaching on the individual next to you. However, these rooms do need to be soundproof to protect the confidentiality of the topics discussed. As you may expect, privacy is crucial during boardroom meetings — the last thing you want is avoidable interruptions or distractions.
While many boardrooms come with state-of-the-art technology and devices (think Bloomberg terminals or the latest stock quote systems), they are not particularly necessary. However, on occasion, you may find big-screen TVs and similar presentation systems in the boardroom.
How to prepare for a board meeting
There are numerous steps a board should take when preparing meetings.
- Meeting dates should be provided and sent to all necessary shareholders and Board members.
- You should also ensure that all board members receive the agenda ahead of time to know what will be discussed.
- Board packs should be provided beforehand, as board members need enough time to understand the issues and may need a few days to prepare meeting notes. These packs will contain reports and other information that will be covered in the meeting. Board packs will contain sensitive documents and should be managed accordingly. They will often contain hundreds of documents.
- Shareholders must familiarize themselves with the board pack ahead of time.
When preparing meetings, board members should familiarize themselves with an online board portal, through which they will receive their board pack.
How to run a board meeting
There are many different approaches when considering how to conduct a board meeting. But, typically, most board meetings will follow the same general set of proceedings.
- The chair will call a meeting to order formally and usually take roll calls, thanking shareholders and board members who are present and apologizing on behalf of those who have not been able to attend.
- Any new participants will introduce themselves and provide a summary of their relevant experience and background.
- Following roll call and introductions, participants will be asked if they have any conflicts of interest with the topics ready for discussion. These will be recorded. Additionally, these board members will have to leave the room while covering those specific topics. Therefore, they will also be unable to vote on any related resolutions regarding those issues.
- More often than not, one of the first items agreed upon is the minutes from the previous meeting. This is an important step as these notes are for a section of the company’s legal record. However, if this is the first meeting of a particular participant, they should ensure they have read the minutes, even though they are not required to agree to them in this instance.
- Once the minutes have been agreed, the chair follows the pre-agreed agenda, introducing every topic and facilitating the discussion. Members will refer back to the board pack during these discussions.
- The chair will then guide discussions and make sure everybody is given the option to contribute. Members can indicate whether they want to make a point by nodding or raising their hands. The chair will then note their desire to speak and invite them to share their opinion at a suitable opportunity.
- Sometimes, the board will also hold presentations from other company departments, which help make informed decisions on relevant topics. This is also a good chance for board members to ask for clarification on any unclear points. Individuals making the presentation will only be able to attend the meeting for their presentation; they will be expected to depart once they have finished.
- The board may also field reports from other board commits, such as nominations, audits, and remuneration committees.
- Some board meeting items will include a resolution or motion which requires a vote from the directors. This will take place at the end of the discussion. The chair will then read the resolution, while a second director will support it before each board member casts their vote. Board members can vote by a show of hands or verbalizing their vote in turn. If the company uses an online board managment software, it can use its digital voting feature to create a record instantaneously. The company secretary will then record the vote results in the minutes.
There are also certain things you should do after the meeting has finished. These include:
- Storing board packs and notes in a secure location, or destroying them after the meeting has concluded. If the board pack and notes are stored on a secure portal, you won’t have to worry about this step as they will already be confidential and access will be limited.
- If any actions have been agreed to during the meeting, they should be noted in the minutes and then sent to all directors, so they know what they should be doing in the organization moving forward.
- Many organizations will follow up their meetings with a chance to provide feedback on how well the meeting was received. This is usually done as a survey or through conversations with the chair. Again, this is a great way to improve the efficiency of the board meeting and the organization as a whole.
Remember, if you take part in a boardroom meeting, you can learn a lot about the company, the way it is run, and play an active role in its functions moving forward. With the right prep, you’ll be able to contribute to these meetings with confidence and assurance.
What is the difference between a boardroom and a meeting room?
A boardroom is a place within an organization in which board members congregate and hold meetings.
A meeting room is a space set aside in a building used for meetings with company personnel. However, it can also be used to meet clients, hold training sessions, and even just have lunch.
While both terms refer to the same thing, a boardroom suggests that the room is only for board meetings, which may be favorable for some shareholders.
Why is it called a boardroom?
It’s called a boardroom because it is where the board of directors meets periodically to discuss issues. Thus, it is sometimes referred to as a meeting room or conference room.
What is a room meeting?
A room meeting is an event in which the board of a company will gather together to conduct business and discuss issues relating to the running of the organization.
What are boardrooms used for?
Boardrooms are used to discuss topics and issues that may arise in the day-to-day activities of an organization. They can also be used for training exercises, client meetings, luncheons, and more.