Governance is strategic. Strategic boards are responding and raising the standard of governance excellence. A robust well-designed assessment process provides an opportunity for corporate boards to gain deeper insights about their functioning and help them achieve governance excellence. Boards are facing increased pressure for accountability from stakeholders. Investors and regulators, in particular, have been reviewing how directors assess performance. Good governance is grounded on self-awareness and commitment to continuous improvement. A highly effective board:
• fosters positive group-board dynamics
• establishes strong governance practices
• promotes board member engagement
• maintains a healthy relationship with management
• ensures focus on mission and strategy
• cultivates a healthy organizational culture
• routinely gauges its effectiveness through robust assessment processes
An annual board assessment is a mainspring process for maximizing board effectiveness. Corporate governance is not one-size-fits-all, and a board’s assessment process should be appropriately tailored. Engaging a useful, annual self-assessment is fundamental to governance excellence. Stakeholders expect it, and disclosure of it evidences a board’s effectiveness and commitment to its role.
Download the CBM/Center For Board Excellence Guide to Board Assessment.
