At our recent portfolio event on effective leadership, one topic that came up during the discussion was what makes a high-performing board. Setting up a board in the right way can be vital in providing founders with advice and expertise and supporting the company’s next stage of growth.
Our speakers – Simon Hill-Norton, Founder and former CEO of Sweaty Betty, Clare Johnston, Founder and CEO of The Up Group, Anca Condrea, Director at The Up Group and Nick Evans, Managing Partner at Active Partners – shared practical tips with the audience based on their experience building boards as founders, investors, and talent advisors.
Here are some of the key things to consider when setting up a board for success:
Think carefully about board composition.
Be thoughtful from the start about the real added value each board member can bring and how to best use it, both in the boardroom and outside of it. When people have clarity over their roles and contributions, they will understand how to best turn up and add value.
In the beginning, the board might consist of only founders and investors, but it can be valuable to bring in non-executive board members early on who can offer extensive networks to tap into, operational expertise in your sector or industry knowledge. As the company grows, you might want to consider bringing in a chairperson who can provide additional leadership and guidance.
Have diverse voices around the table.
It’s no secret that greater diversity leads to better business outcomes. Think about gender and ethnic representation on your board, but also other types of diversity like age and socio-economic background. If you’re working with a headhunter to build your board, be clear in your request and ensure they provide you with long and short lists which include diverse candidates.
Put a clear structure around board processes.
Be clear from the start about what sort of board you want to build, why people are there and how you’d like them to engage. Share slides or materials ahead of time, keep board meetings to a set time (2-4 hours is typical) and circulate concise minutes afterwards. If a topic is taking too long, you can always move the conversation forward and revisit it outside the board meeting.
Use board meetings to look to the future.
Boards are not in place to provide operational support or execute tasks, but rather to provide strategic direction and offer challenge and advice. Share financials with the board ahead of time to avoid delving into past performance in too much detail. Board members should arrive prepared, allowing most of the meeting time to focus on specific strategic future priorities, whether it’s expanding into a new market or seeking advice on a strategic challenge.
Create opportunities to get to know your board members beyond the boardroom.
Organise occasions for the board to come together outside of formal meetings to help build rapport and relationships among board members. This could include dinners every few months after a board meeting or encouraging informal coffee meetings. These interactions will help increase trust and create a cohesive and collaborative board that works more effectively and provides valuable support to the executive team.
Building a high-performing board is an ongoing process.
The board will evolve as the company grows, new shareholders join and strategic priorities change. In the early stages, everyone on the board is likely deeply invested in the business. However, as the company grows, you might bring on board members who have multiple priorities to juggle. Regularly evaluating the board’s composition, performance, and effectiveness to ensure it continues to meet the evolving needs of the business is crucial.
For more content and takeaways from the event, check out our speakers insights on effective leadership during uncertain times here.