Questions for Your Next Board Meeting

Will 2023 bring a recession and economic downturn, or have the headwinds shifted? Are the demands from key stakeholders (employees, customers and vendors) increasing? Does the organization have a workforce planning strategy that addresses the current needs of employees at every level of the organization? How can organizations prepare for challenges by identifying risks within the organization? Does the board have a role if the organization experiences a cybersecurity incident?

Boards are in a prime position to assist their organizations by asking questions that help management evaluate options and consider varying perspectives when making challenging decisions. Are they being provided the right level of information needed to make informed decisions? 

Weaver, knowledgeable in advisory services, offers several topics to incorporate into the discussions at your next board and committee meetings, to generate productive discussion and illuminate prospective opportunities as well as challenges.

1. How is the company adapting to inflation and economic uncertainty? 

Most organizations are experiencing continued increases in the costs of doing business. From payroll expectations to materials and the cost of technology, expenses are increasing across the board. The uncertainty in today’s business environment requires leaders to ask tough questions and perform routine analyses to evaluate and react to economic changes in a timely manner.

• How are margins changing and what sensitivities can be (or already are) run to evaluate continued changes in costs?
• Are analyses being performed to evaluate pricing changes and the impact on revenue and net income?
• Are material prices going to increase, and if so, what is the strategy to pass through to customers?
• What risks could prevent the organization from achieving its revenue goals in the current year?
• What is the organization’s recent history with revenue fluctuation, price changes, and increasing expenses in the past 12-months with inflation and continued economic uncertainty? Are there mistakes or lessons learned that should inform procedures that will be implemented and made routine going forward?

2. How is the organization managing current and future staffing needs? 

Organizational success depends on having an engaged and empowered staff. A defined and monitored approach to talent recruitment and development, compensation and incentives, and succession planning is crucial to instilling fairness and accountability while mitigating risk.

Workforce planning strategies must be a topic in the current business environment. The strategies must address all levels and functions in the organization, and include early identification of high potential employees, new work practices that reflect changing expectations of new generations entering the workforce, and “right sized” staffing to reflect the organizations capacity and coverage needs.

• Does the organization have up to date workforce planning strategies for every level?
• Has the organization evolved post pandemic to reflect expectations among new generations entering the workforce?
• Has the organization identified departments or segments that are particularly challenged with staffing issues and made efforts to address underlying issues that may be creating these issues.
• How long are position requisitions staying open before being filled?
• How successful is the organization in making offers to candidates and converting those offers into employees?
• What feedback is obtained through exit interviews from employees who leave voluntarily?
• Has the organization identified and put in place strategies to identify and retain high performing employees? What makes long-term employees want to stay at the organization? Are high performing employees experiencing these benefits?

3. Does the board integrate enterprise risk management in its review?

The board has overall responsibility for enterprise risk management (ERM) oversight and governance. A healthy understanding of risk and compliance allows the organization to turn risk management into a strategic advantage. Risk categories include activities related to these categories: financial, compliance, operational and strategic. For example, financial risk is the risk that a company will fail to adequately forecast and plan to achieve necessary cash flow and operating margins, cover operating costs, provide value to stakeholders, manage liquidity, and accurately report financial results.

• How well is enterprise risk management embedded into the organization’s processes and activities?
• Has the board reviewed the organization’s risk profile?
• Are there stakeholders within management tasked with managing the response and risk mitigation activities associated with key risks?
• Do stakeholders periodically report to the board on the nature and effectiveness of mitigation and monitoring activities for key risks?
• Have monitoring activities and other functions of internal audit been incorporated into the risk management effort?

4. In the event of a cyber-incident at the organization, what is the board’s role? 

Rightfully so, the topic of cybersecurity has become a routine discussion point in board meetings. Is the board asking the right challenging questions or just receiving an update from management? Asking targeted and specific questions can help ensure that the organization is operating an appropriate capacity to prevent a cyber incident and to respond appropriately if one does occur.

• In the event of a cyber incident, how will the board be notified? What actions, if any, would the board need to take? 
• How have the organization’s cybersecurity protocols evolved or improved in the last 12-months?
• How are the organization’s cloud-based applications and data considered and covered in the cybersecurity plan?
• What are the critical assets that must be protected and how are they prioritized in the cybersecurity program?

5. Are board materials sufficient and focused on board-level priorities? 

The nature and extent of materials that management provides to the board can vary greatly from organization to organization. Volume of documentation, cadence, level of detail – all are areas that management and the board should coordinate to ensure that the right information is presented and shared.

• Do members of the board have enough time to read and digest information in advance of the meeting?
• Is the volume of information presented to the board appropriate? Could information be pared down or summarized more succinctly?
• Conversely, is there additional information or more detail that would be beneficial for the board to receive?
• Is the appropriate information being presented and discussed in committees?

Weaver offers information and insights to prepare for your next board meeting. We can help you ask the right questions and determine appropriate plans of action based on topics and trends as they unfold. Subscribe to our monthly insights for articles and information to help you review your organization’s operations and prepare for change in an uncertain world. Contact us for information about these areas of board governance.

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