Many companies had never considered virtual board meetings before. The traditional way was to gather directors together in one room for physical meetings. Then coronavirus entered our lives. Governments across the world locked countries down and implemented social distancing measures that meant the old way was no longer possible.
Legislation around the world was swiftly updated to allow for remote meetings. For example, in the UK, the Corporate Insolvency and Governance Act 2020 allowed companies to conduct “meetings in a safe and practicable manner in response to the pandemic (e.g. virtual meetings).”
The world has changed. The percentage of employees in Europe working from home has increased from 5% to 12.3% since the pandemic began. Many companies are adjusting their expectations of their employees’ working habits, opening the door to make working from home a regular practice and splitting the week between office and remote locations. Remote working is no longer a temporary measure to see businesses through the pandemic, it is now an integral part of working life at all levels of many companies.
LOOKING AHEAD: THE RETURN TO THE BOARDROOM
As countries start to open up again and relax their restrictions, it is natural that some people will be keen to get back to the office and many directors will want to return to the boardroom, too. However, things will not be the same, as CUManagement predicts:
“It’s becoming clear to many boards that a “return to normal” in the coming months is less likely than a shift to a “new normal”—one that involves a hybrid approach of remote and in-person governance… Before the pandemic, if you dialled in virtually instead of attending an in-person meeting, it was frowned upon. Now, however, this stigma is disappearing and will likely continue to disappear after the pandemic ends.”
Some boards might return to in-person meetings only but others will switch to fully virtual board meetings or a hybrid approach. Here are the differences:
The virtual and hybrid approaches appear to represent the future of board meetings. This doesn’t come as a surprise because there are many benefits that taking your board meetings online can bring to your organisation.
THE BENEFITS OF VIRTUAL AND HYBRID BOARD MEETINGS
You can have more flexibility over scheduling a board meeting if it takes place online. Without having to consider people’s travel time, they only need a free window for the designated length of the meeting, meaning they don’t have to block out a whole day for a meeting that lasts a couple of hours.
For board members based overseas, it allows them to attend in spite of travel restrictions and quarantine periods that might be in place.
A hybrid meeting provides flexibility for the participants who can choose whether to attend in person or remotely. This means that they can fit their duties around other commitments more easily.
Cut your carbon footprint
Many of the cost-cutting measures also have the bonus of being more environmentally friendly. At a time when shareholders are increasingly interested in the ESG performance of a business, reducing travel and paper are steps in the right direction for any organisation.
As the world tentatively steps away from the pandemic, we cannot be certain that there will not be further waves and, as a result, lockdowns. To completely remove the virtual element means that it will take longer to adjust back into that method of meeting if that’s necessary.
Maintaining a virtual or a hybrid approach means you can smoothly transition between methods of working as soon as the situation changes.
Virtual meetings cut costs on travel expenses for the business. Fewer board members attending a physical location also means you spend less on refreshments. For those companies that do not boast their own boardroom, you can reduce the amount you spend on room hire if there are fewer physical attendees at a hybrid meeting. You can even eradicate these costs completely if you go fully virtual.
Virtual meetings also tend to be paperless, especially when using a board portal. This reduces the costs of printing and posting documents to directors.
Greater control over the discussion
For a virtual or a hybrid meeting, there needs to be protocols in place over who speaks and when, as it is difficult to ascertain the identities of a number of remote directors all talking over each other.
This allows the chair to have greater control over the discussion, bringing in those who might otherwise be lost in the crowd. Directors do not need to battle against each other to be heard. They all have their fair opportunity to talk.
The use of digital board packs on a board software portal means that every director has instant access to the latest version of each document. They can use the search function for information they want to access and find it instantly, rather than spending valuable time trawling through a paper copy.
Board members can annotate board papers and enter into discussions ahead of the meeting, meaning that they don’t have to use meeting time for those initial discussions.
LEGAL AND COMPLIANCE CONSIDERATIONS
Are virtual board meetings legal?
The legality of virtual board meetings depends on the laws in your country and the company’s Articles of Association. It is possible to make changes to the Articles in order to allow remote board meetings but you will need the approval of your shareholders.
Who can host a virtual board meeting?
Any organisation can host a virtual board meeting as long as its constitution and the local jurisdiction allow for that. The chair should take the lead, as with an in-person, physical meeting.
What notice needs to be given?
The notice given to board members of a virtual board meeting must fit in with the company’s articles, both in terms of the timeframe required and in terms of the method of the notice (written, verbal or electronic).
Even if there are no specific terms for notice set out, it is good practice to send it out as early as possible so that directors can properly prepare for the meeting.
What details should be included in the notice?
Standard board meeting practice suggests that the notice should include the date, time and location of the meeting. As a virtual or hybrid board meeting means that the directors will be in remote locations, it should also detail how they can attend the meeting online.
How to ensure a quorum is present?
It is essential that your board meeting is quorate to ensure the validity of any decisions made. The number of directors required to form a quorum depends on the bylaws.
During a virtual meeting, you should be vigilant to make sure that enough directors for a quorum are able to follow the proceedings at all times. If someone drops out and there is no longer a quorum, any decision made on that topic will not be deemed to be binding.
TIPS FOR HOLDING AN EFFECTIVE VIRTUAL OR HYBRID BOARD MEETING
Choose your tech with care
You need a secure, stable platform to host your board meeting. A platform that is also simple enough to understand for all board members.
You could choose a standard video conferencing tool, such as Zoom or Teams, to carry out your meeting. However, many boards choose a board meeting platform that integrates document sharing, voting and video calling into one package. Of course, this can prove more costly to the business.
Before your first virtual or hybrid board meeting, allow members to test out the technology and become comfortable with it. Inform them about the processes you will use to carry out the meeting. It is also important to run through a demo meeting with in-person attendees so that you can iron out any issues that arise relating to the interactions between physical and digital board members.
Have everyone on screen
You might opt to have physical attendees appear on the board meeting platform as well as the remote participants. They could use their devices in the boardroom to help level the playing field when it comes to contributing to the debate and gaining the attention of the chair.
Having everyone attend virtually makes life easier for the chair, too. They can keep an eye over everyone in one location, rather than having to continually shift their gaze from the screen to the room and back again.
Establish a meeting protocol
You need a system in place to allow everyone to have their say, offer their perspectives and for the conversation to be clear and easy to follow. These ground rules might involve using features of the technology to raise a virtual hand so the chair can give the floor to the relevant director. It could also involve each speaker mentioning their name before they speak so everyone knows who is giving the input.
It’s good practice in virtual and hybrid meetings for members to mute their microphones when not talking to avoid the distraction of background noise.
The chair must decide how to acknowledge those wishing to contribute in a manner that does not disadvantage the remote attendees.
In a virtual meeting, everyone needs to have high-quality microphones and headphones to make it easy to follow what’s happening.
In a hybrid meeting, it gets a bit more complicated. There could be a discrepancy between what the physical and virtual attendees hear unless you pay attention to the audio side of things. One solution is to set up microphones around the room to capture those who are there in person, meaning that those online won’t miss important comments during the meeting.
Think about the video aspect
Your virtual or hybrid meeting also needs proper video because, in these environments, it becomes much more difficult to read body language and facial expressions — both important during a live discussion.
As you set up your room for a hybrid meeting, think about what those on the video call will see and what else they need to be able to look at. This means either pointing the camera at the table to capture all of the physical attendees or having them on camera. Alternative solutions include pointing them towards a physical screen to see the presentations or screen sharing with them during the meeting. This enables those attending in person to view the same material.
Set up a clear voting procedure
One of the most important aspects of the board meeting is the voting and that is affected by the move to online environments. There is no set way to perform voting in a virtual or hybrid meeting, so you can choose the option for interaction that works best for you.
Those that use board meeting software can take advantage of the in-built voting feature for engagement, whilst others can use verbal voting or a show of hands if the chair is able to see all attendees in person and on camera at once.
Shorten the agenda
Having a shorter agenda aids the momentum of the meeting and keeps the discussion focused. It can be uncomfortable to spend too long staring at a screen, so keeping things tighter provides a better user experience for remote board members and forces you to consider only the most important business of the day.
Set aside time for socialising
Another key element of the ideal hybrid or virtual board meeting is the social aspect. The personal bonds that people develop during chats at coffee breaks and before and after the meeting are helpful in building a cohesive board that works in unison. If that is reserved only for those attending in person, it could create an imbalance on the board.
You could schedule to start the meeting ten minutes early to allow for virtual socialising before launching into the agenda. This is particularly helpful for new recruits who may never have met their colleagues in person.
As we enter this new age of virtual meetings, getting feedback on meeting performance is essential. It is new territory for many and being able to evaluate and tweak processes with instant feedback will help accelerate your journey to peak performance.
Boardclic Meeting Express is a new tool that helps you get real-time feedback after each meeting. As the name suggests, this happens so quickly that board members will barely notice it. The benefits for the board, however, can be tremendous — from identifying strengths and weaknesses to helping you optimise your workload to increase efficiency.
WHAT WILL THE NEW NORMAL LOOK LIKE?
It seems likely that some form of the virtual board meeting is here to stay. As younger digital natives join boards, they will bring with them an expectation of the flexibility of remote working on the internet. The multiple benefits for organisations mean that they will be keen to facilitate this method of working.
However, there will also be many board members who prefer to attend a physical meeting. In addition, there is no way of knowing when travel restrictions will end, meaning that boards with members spread across different countries will need an agile and flexible approach to meetings. This is why the hybrid option is likely to prevail in the new normal.
With hybrid meetings, you cover all bases. If there are further waves of Covid-19, it does not matter if the home region of one or more of your board members locks down or one of them has to isolate due to catching the virus. They still have the ability to participate.
Although there is a lot to consider with virtual and hybrid board meetings, including the legal and logistical implications, the benefits mean that they are a powerful tool in the arsenal of any progressive board. All boards should strive to continually improve and refine their processes. Going online is one way to boost potential attendance, save money and futureproof the organisation.
A hybrid approach provides that extra level of convenience and accessibility. It suits those who prefer to be physically present, and accommodates those who would rather work remotely or who are compelled to do so through location, self-isolation or any other reason. Although it is tough to organise the perfect hybrid event, gaining real-time feedback on each meeting helps you hone your processes and set procedures in place to constantly improve your board meetings.
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