Board Meetings And Governance

Question 2

What is the purpose of the session on board meetings and governance?

Answer 2

To examine the composition and structure of the board and develop effective meeting procedures.

Question 3

What should participants be able to consider by the end of the session?

Answer 3

A board’s composition, structure, and performance.

Question 4

What are relevant board meeting protocols and procedures?

Answer 4

Including the use of committees.

Question 5

What is the value of director evaluation?

Answer 5

Ongoing professional development.

Question 6

What factors influence board composition?

Answer 6

• Board size
• Director tenure
• Structure of the organization
• Stage of organization’s development
• Locations of operation
• Strategies pursued
• Nature of organization (profit vs. not-for-profit)
• Type of company (family, publicly listed, Indigenous, proprietary)

Question 7

What must be disclosed in governance reporting?

Answer 7

The composition of the board and governance structures.

Question 8

What are the types of boards mentioned?

Answer 8

• All executive boards
• All non-executive boards
• Majority executive
• Majority non-executive

Question 9

What is an advantage of all executive boards?

Answer 9

Can make quick decisions working together.

Question 10

What is a disadvantage of all executive boards?

Answer 10

May lack diversity in perspectives.

Question 11

What does a majority executive board include?

Answer 11

Some non-executive directors (NEDs) to inject external perspectives.

Question 12

What is the ASXCGC recommendation for board composition?

Answer 12

Majority non-executive directors for ASX listed companies.

Question 13

What are key actions to improve board performance and develop directors’ skills?

Answer 13

• Establish clear expectations
• Implement ongoing training and development
• Encourage active engagement
• Conduct regular board evaluations
• Foster a strong governance culture
• Improve decision-making processes
• Strengthen board composition
• Leverage external expertise

Question 14

What is the role of the chair in a board meeting?

Answer 14

To link between board and organization, encourage open debate, evaluate CEO’s performance, and assist with selecting board committee members.

Question 15

What should the agenda for board meetings include?

Answer 15

• Last meeting minutes
• Updates on action items
• Key decisions on strategy and performance
• Reports from CEO and CFO
• Proposals for Capex
• Overview of company’s progress

Question 16

What is a ‘circular resolution’?

Answer 16

Allows decisions to be passed without a meeting by sending written documents to be signed.

Question 17

What is the purpose of board meeting minutes?

Answer 17

To delegate authority, communicate decisions, and protect diligent directors.

Question 18

What are the responsibilities of the audit committee?

Answer 18

• Communication with auditors
• Review of financial statements
• Management of information systems
• Efficiency of audit functions

Question 19

What is the role of the risk committee?

Answer 19

To assess if the organization is operating within its risk appetite and monitor compliance with risks.

Question 20

What challenges are there in evaluating board performance?

Answer 20

• Lack of clear evaluation criteria
• Conflicts of interest
• Resistance to feedback
• Limited accountability
• Engagement and participation issues

Question 21

True or False: The board should become involved in the operational areas of the organization.

Answer 21

False

Question 22

What is essential questioning for directors?

Answer 22

Directors have the responsibility to ask questions and challenge opinions.

Question 23

Fill in the blank: Directors must have high ______ standards.

Answer 23

[ethical]

Question 24

What must a board’s composition regularly be reviewed for?

Answer 24

To ensure it includes a good range of age, experience, skills, perspectives, backgrounds, ethnicities, and genders.

Question 25

What should be included in a CEO’s report?

Answer 25

Progress report of the organization's plans, policies, and budget.

Question 26

What does a CFO's report typically include?

Answer 26

* P&L * Balance sheet * Cash flow statement * Variance in budget with reasons

Question 27

What is a quorum in the context of board meetings?

Answer 27

Minimum number of directors required for a valid meeting.

Question 28

What is the typical length of a board meeting?

Answer 28

4 hours normally sufficient.

Question 29

What are the characteristics of effective directors?

Answer 29

* High ethical standards * Skills and experience * Competence in specialized area * Sound judgement * Willingness to challenge opinions * Integrity * Ability to devote required time

Question 30

What should board meetings allow for?

Answer 30

Formal and informal proceedings, including time for free discussion.

Question 31

What is the significance of diversity in a board?

Answer 31

A range of views and perspectives that can lead to new ideas and innovation.

Question 32

What is the importance of fostering a board culture?

Answer 32

Encourages divergent views and open discussions.

Question 33

What type of board is mandated to have specific skills as per the Aged Care Act 1996?

Answer 33

Majority independent non-executive directors with at least one member experienced in clinical care.

Question 34

What are the key components of measuring board performance?

Answer 34

Peer reviews and external evaluations ## Footnote These methods help identify gaps in skills and knowledge.

Question 35

What should be adjusted based on performance reviews?

Answer 35

Board composition ## Footnote Adjusting board composition can help address changing needs.

Question 36

What are some ways to foster a strong governance culture?

Answer 36

* Implement a code of conduct * Encourage ethical decision-making * Promote open communication ## Footnote These practices help build accountability within the board.

Question 37

What are essential elements for improving decision-making processes?

Answer 37

* Well-structured meeting agendas * Use of data and expert insights * Allowing diverse perspectives ## Footnote These elements help avoid groupthink.

Question 38

What should be considered when strengthening board composition?

Answer 38

* Diverse expertise and backgrounds * Inclusion of independent members * Balance between seasoned and emerging leaders ## Footnote A diverse board can enhance decision-making.

Question 39

How can external expertise be leveraged by a board?

Answer 39

* Invite industry experts * Encourage mentorship * Benchmark against best practices ## Footnote External insights can bring fresh perspectives.

Question 40

What should a potential board member understand before joining?

Answer 40

* Insolvency risk * Regulatory risk * Performance risk * Reputational risk ## Footnote Understanding these risks helps assess personal liability.

Question 41

What factors should be researched regarding board dynamics?

Answer 41

* Background and skills of current directors * Relationships between stakeholders and management * Potential conflicts ## Footnote Awareness of these factors can prevent future issues.

Question 42

What is a key consideration for directors in non-profit organizations?

Answer 42

Alignment with the cause of the charity ## Footnote This ensures that directors are committed to the mission.

Question 43

What is important during the induction process for directors?

Answer 43

Support preferences from new directors ## Footnote Understanding how directors want to be supported can enhance their onboarding experience.

Question 44

Who is responsible for promoting ongoing professional development for directors?

Answer 44

The Chair ## Footnote The Chair must emphasize the importance of ongoing professional development.

Question 45

What was a significant issue in the James Hardy case study?

Answer 45

The directors claimed the minutes were false ## Footnote This led to their guilt for failing to act with care and diligence.

Question 46

What are best practices for ensuring accurate board meeting minutes?

Answer 46

* Assign a competent minute-taker * Use a standardized template * Capture key points, not verbatim notes * Clearly document decisions and actions * Review and approve minutes promptly * Ensure confidentiality and compliance ## Footnote Following these practices can prevent legal issues.

Question 47

What financial information is necessary when selling a business?

Answer 47

* Profit & Loss Statements * Balance Sheets * Cash Flow Statements * Tax Returns * Debt and Loan Agreements * Revenue Breakdown * Accounts Receivable & Payable * Financial Projections ## Footnote This information helps ensure a smooth transaction.

Question 48

What legal documents should be prepared when selling a business?

Answer 48

* Business registration documents * Contracts with suppliers and customers * Lease agreements * Employment contracts * Regulatory compliance documents * Pending or past legal disputes ## Footnote These documents are crucial for a successful sale.

Question 49

What operational information is important for a business sale?

Answer 49

* Organizational structure * Standard operating procedures * Customer and supplier contracts * Technology assets * Inventory and asset lists ## Footnote This information provides insight into the business's operational health.

Question 50

What should be included in the market and competitive position analysis?

Answer 50

* Market analysis * Customer demographics * Competitor analysis ## Footnote Understanding these factors helps position the business effectively.

Question 51

What is a key consideration for the owner's role post-sale?

Answer 51

Consulting or transition support ## Footnote Defining this role can ease the transition for the new owner.

Question 52

What is essential for employee retention during a business transition?

Answer 52

An employee retention plan ## Footnote This plan helps maintain stability during the sale process.