But the effectiveness of a board review doesn’t just happen; it requires careful preparation and thoughtful follow-up. Here’s a deep dive into the essential steps to take before and after a board performance review to ensure the process is impactful and yields actionable results.

Before the board performance review

1. Define clear objectives

Clarity of purpose is the cornerstone of a successful board performance review. Before embarking on the evaluation, it’s essential to ask: What do we want to achieve? Are we looking to refine our governance practices, enhance strategic oversight, or perhaps address specific challenges such as board dynamics or risk management? These objectives will act as the guiding star throughout the review process.

When setting these objectives, involve key stakeholders, including the chair, lead independent director, and relevant board committees, to ensure alignment across the board. Consider the organisation’s current challenges and long-term goals. For example, if the company is undergoing significant growth, you might focus on evaluating the board’s ability to scale its oversight and strategic input. Clearly defined objectives help shape the review process, from selecting the evaluation method to crafting the questions, ensuring that the review is focused, relevant and yields meaningful insights.

2. Select the right evaluation method

The method you choose to evaluate the board can significantly influence the depth and quality of the feedback received. There are three typical methods: the board's self-assessment, peer evaluation and external evaluation. Each has its merits, and the choice depends on the board’s specific needs, culture and the level of objectivity required.

The board's self-assessment refers to any evaluation process conducted internally without external facilitation. This can include assessments of the board as a whole, as well as peer evaluations where individual directors evaluate each other. While this approach is cost-effective and promotes internal accountability, it may lack the objectivity and critical perspective that an external evaluation provides.

Peer evaluations are a subset of self-assessment, focusing on board members assessing each other’s contributions. This method can offer valuable insights into the dynamics within the board and help identify areas for individual improvement. However, it requires a high level of trust and transparency among members to be truly effective.

External evaluations involve bringing in an independent facilitator to guide the process. This approach ensures a more objective and comprehensive analysis, making it particularly valuable for boards seeking deeper insights or addressing complex challenges.

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Combining these methods to gain a comprehensive view of the board’s performance. For instance, you might start with a self-assessment to encourage personal reflection, followed by an external evaluation to provide an objective benchmark.

3. Evaluate board composition

The composition of a board is a critical factor in its overall effectiveness. A well-composed board brings together a diverse mix of skills, experiences, and perspectives, enabling it to address the multifaceted challenges an organisation faces. Before conducting the board performance review, it’s essential to take a close look at the current makeup of the board and assess whether it aligns with the organisation’s strategic goals and the environment in which it operates.

Begin by creating a matrix of the skills, expertise, and experiences that are most critical to the organisation’s success. This matrix should be informed by the company’s strategic priorities, industry challenges and the evolving regulatory landscape. For example, if the organisation is focusing on digital transformation, having board members with deep expertise in technology and innovation becomes crucial. Similarly, in industries with stringent regulatory requirements, legal and compliance expertise on the board is indispensable.

Next, compare this list with the current board composition. Identify any gaps or areas where the board may be lacking in essential skills or where certain perspectives are underrepresented. For instance, is there sufficient financial expertise to oversee complex financial decisions? Does the board have members with experience in the company’s key markets? Is there diversity in terms of gender, ethnicity, and age that reflects the broader society and brings a range of viewpoints to the table?

It’s also important to consider the board’s ability to adapt to future challenges. As the business landscape evolves, so too should the composition of the board. This means not only addressing current gaps but also anticipating future needs. For example, as environmental, social, and governance (ESG) concerns become increasingly central to corporate strategy, boards may need to bolster their expertise in sustainability and social impact.

4. Prepare the board for honest reflection

The success of a board performance review hinges on the willingness of board members to engage in honest and constructive self-reflection. However, this level of transparency doesn’t come naturally, especially in environments where there may be a fear of criticism or discomfort in addressing sensitive issues.

To prepare the board for this critical introspection, it’s essential to create an atmosphere of trust and openness. This can be achieved through pre-review workshops or informal discussions that set the tone for the upcoming evaluation. These sessions should emphasise the importance of candid feedback and the role it plays in the board’s development.

Additionally, consider providing board members with resources or training on how to give and receive feedback constructively. This not only prepares them for the review but also enhances the overall effectiveness of their interactions during the evaluation process.

5. Develop a detailed review plan

A successful board performance review is as much about the process as it is about the outcomes. Without a detailed plan, the review can quickly become unfocused, leading to missed opportunities for improvement. Developing a comprehensive plan ensures that every aspect of the review is thoughtfully considered and executed.

Start by outlining the timeline for the review, including key milestones such as the selection of the evaluation method, the collection of data and the analysis of results. Decide who will lead the review process –typically, this responsibility falls to the chair, lead independent director, or a specific board committee, such as the governance or nominating committee.

Next, determine how the data will be collected. Will it be through surveys, interviews or a combination of both? How will anonymity be preserved to ensure honest feedback? These are critical questions that need to be addressed in the planning stage.

Finally, consider how the results will be reported back to the board. Will there be a formal presentation, or will the findings be shared in a more informal setting? Clear communication is essential to ensure that the insights gained from the review are understood and acted upon.

After the board performance review

1. Analyse the results with a critical eye

The completion of the review is only the beginning. The data collected during the evaluation process holds the key to understanding the board’s strengths and areas for improvement – but only if it is analysed thoroughly and critically.

Start by reviewing the data in its entirety, looking for patterns and correlations that might not be immediately obvious. For instance, if several board members highlight concerns about the board’s dynamics, this could indicate deeper issues with communication or decision-making processes.

It’s also important to contextualise the findings. How do they compare to previous evaluations or industry benchmarks? Are there trends that suggest a need for a significant shift in how the board operates? This critical analysis is essential for translating raw data into actionable insights that can drive meaningful change.

Consider bringing in external experts or consultants to help with this analysis. Their objective perspective can provide additional clarity and ensure that the findings are interpreted accurately.

2. Develop an action plan

The insights gained from the board performance review are only valuable if they lead to action. Developing a comprehensive action plan based on the evaluation results is crucial to ensuring that the board’s strengths are leveraged and its weaknesses are addressed.

This action plan should be specific, measurable and time-bound. For example, if the review identified a need for better risk management, the action plan might include steps such as revising the board’s risk management policies, conducting training for board members and regularly reviewing the organisation’s risk profile.

Assign clear responsibilities for each action item to ensure accountability. This could involve assigning tasks to specific board members, committees or even external advisors. Additionally, set realistic deadlines for each action to ensure that progress is made in a timely manner.

Finally, consider how the action plan will be communicated to the board and other stakeholders. Transparency in this process is key to maintaining trust and ensuring that everyone is on the same page regarding the board’s development goals.

3. Communicate findings and next steps

Transparency and clear communication are essential in the aftermath of a board performance review. Once the analysis is complete and the action plan is developed, it’s important to communicate these findings and next steps to the board and relevant stakeholders.

Start by preparing a concise report or presentation that outlines the key findings of the review. This should include both strengths and areas for improvement, along with the proposed action plan. Be honest about the challenges identified and how the board plans to address them.

Depending on the sensitivity of the findings, you might choose to share this report in stages, starting with the board itself before presenting it to other stakeholders. The goal is to ensure that the communication is clear, concise and focused on how the changes will benefit the organisation.

In addition to formal communication, consider holding follow-up discussions with board members to address any concerns or questions they may have. This helps reinforce the importance of the review and ensures that everyone is committed to the action plan.

4. Implement changes and monitor progress

The action plan is only as effective as its implementation. Once the plan is in place, it’s crucial to ensure that the proposed changes are carried out and that their impact is monitored over time.

Establish a system for tracking progress on each action item. This could involve regular check-ins at board meetings, progress reports from committees or updates from individual board members. The goal is to ensure that the board remains accountable for implementing the changes and that any obstacles are identified and addressed promptly.

Monitoring the impact of these changes is equally important. Are the changes leading to the desired improvements? If not, why? Continuous evaluation allows the board to make adjustments as needed, ensuring that the action plan remains effective and relevant.

Consider setting up regular review sessions to assess progress and make any necessary course corrections. This ongoing evaluation helps keep the board focused on its development goals and ensures that the improvements are sustainable.

5. Foster a culture of continuous improvement

A board performance review should not be seen as a one-time event but as part of a broader commitment to continuous improvement. To truly elevate the board’s effectiveness, it’s essential to embed a culture of ongoing self-assessment, regular feedback and periodic formal reviews.

Encourage board members to engage in continuous learning and development, whether through formal training, attending industry events, or participating in workshops. This commitment to professional growth helps ensure that the board remains dynamic and responsive to new challenges and opportunities.

Regularly revisit the action plan and the outcomes of the review process to assess whether the board is meeting its development goals. Celebrate successes, but also be willing to acknowledge and address any ongoing challenges.

Finally, consider institutionalising the board performance review process by incorporating it into the board’s annual calendar. This ensures that the board remains committed to continuous improvement and that the review process becomes an integral part of the board’s governance practices.

Our take

A board performance review is more than just an exercise in compliance and transparency; it’s a powerful catalyst for real transformation within the boardroom. When approached with careful preparation and followed by decisive action, this process can elevate the board's effectiveness, sharpen its strategic vision and significantly boost its contribution to the organisation's long-term success. Whether you're embarking on your first review or looking to enhance an established process, these ten steps provide a comprehensive guide to conducting a review that fosters deep reflection, drives impactful change and ensures your board remains a proactive force in steering the organisation towards its goals.

BoardClic delivers a comprehensive, fully digital board evaluation solution that boosts board performance by providing in-depth assessments of effectiveness, alignment and composition. With the BoardClic platform, boards gain actionable insights that help them address key challenges and benchmark their performance against a wealth of industry data, setting them on the path to achieving best-in-class standards. Our platform is designed to be efficient, secure, and user-friendly, enabling boards to focus on continuous improvement without the hassle of complicated processes.

Sign up for our interactive demo to experience BoardClic first-hand and discover how our platform can transform your governance practices.