IN a webinar organized by BoardPro Ltd., a board management software company in Australia, I saw a video that tackled ways to create effective minutes for board meetings.
The panelists who shared their insights were: Brett Herkt, BoardPro co-founder and CEO; Steven Bowman, professional director at Conscious Governance; and Jen Butler, board specialist at Absolute Gems. Here are key takeaways from the webinar:
1. Why are minutes important?
Board meetings are an essential component of an organization’s decision-making process and board minutes matter because they:
- Fulfill compliance requirements. Minutes are required of incorporated bodies in most jurisdictions.
- Demonstrate the integrity and thoroughness of process. Minutes are an enduring record of the Board’s deliberations. Courts accept board minutes as the best record of matters in a dispute.
- Protect organizational and director reputation. Minutes are evidence of how a Board has dealt with conflicts of interest.
- Clarify responsibility and track implementation. Minutes define the action to be taken and the assignment of responsibility. They establish an implementation tracking reference point.
- Evaluate and review decisions. Minutes record the rationale for policy creation or an important resolution to facilitate a post-decision evaluation, among others.
- Facilitate due diligence, induction and audit. Minutes assist prospective Board appointees to undertake due diligence as well as new board members (and new executives) to get up to speed. They also support an audit process.
- Document organizational evolution. Board (and general meeting) minutes are a first draft of a corporate entity’s history.
2. Who should take the minutes?
The minute taker is an extension of and should be explicitly empowered by, the Board chairman and someone who has enough understanding of the business of the meeting to record what is significant and who is not involved. The minute taker should be sufficiently confident to ask what is being discussed and/or decided.
3. What should be in the minutes?
Basics include the title of the meeting, date and time (start/finish), venue and place, participants (including comings and goings, quorum), description of what business was dealt with and in what order, how the business was handled, what was decided (procedure, discussion, resolutions, votes) and why.
4. How long should the minutes be?
Minutes are not a transcript of the meeting and, unless there are good reasons otherwise, board minutes do not document who said what. The extent to which matters are documented should be proportional to their substance or materiality. They should be an adequate description of the meeting for someone who was not present.
5. How are minutes prepared and finalized?
Draft minutes should be prepared and submitted for review by the Chairperson within a day or two of the meeting. They are distributed to those present for confirmation or comment and then to anyone else required to act on them. Formal confirmation by the Board that they are a true and correct record is needed, then confirmed by the Chair and placed in an appropriate storage facility.
Octavio Peralta is currently the executive director of the Global Compact Network Philippines and founder and volunteer CEO of the Philippine Council of Associations and Association Executives, the “association of associations.” PCAAE is holding its Associations Summit 10 (AS10) on November 23 and 24, 2022. E-mail: bobby@pcaae.org