The essence of conducting board evaluations is to gain deep insights into the direction the company may be headed. It helps in determining the effectiveness of the board as a whole as well as individual directors, and subsequently informs the governance action that should be taken, be it a corrective initiative or a strengthening activity.
Needless to state, an effective and properly constituted board drives long-term organisational value and strengthens stakeholder trust. Therefore, embracing board evaluation is a strategic imperative that will help elevate the overall growth and stability of the company, and trigger processes for reinforcing commitment of the board to corporate governance excellence.
Surveys conducted in the US and UK show that more than 90 percent of successful companies conduct board evaluations. This highlights the importance with which board evaluations are held across different markets.
However, not all companies that undergo board evaluation implement recommendations arising from the process. Just about 60 percent of them do and realise the benefits. Further studies have shown that often, organisations that fail to take action after board evaluation tend to be in disagreement with the way the process was conducted, and therefore contest the recommendations.
It follows that meticulous planning and implementation of a board evaluation is vital and will increase the likelihood of positive outcomes.
This is why at RR Group, we shall work closely with you to design a board evaluation matrix that will suit your organisation, and then help you execute the process transparently and objectively. This is so that the recommendations we provide at the end are a product of agreeable processes, and are realistic and impartial.
In summary, our role is to objectively help drive your board practices forward for the benefit of the entire organisation.
