Indiana Checklist Evaluation of Potential Board Member Nominees

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US-DD07253
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Description

This due diligence checklist should assist Boards of Directors, Nominating Committees, and other bodies in screening potential Board member nominees. This checklist is merely a tool to be used as one part of a broader process. It is not intended to replace or to reduce the scope of the overall evaluation process.

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FAQ

Board evaluations are aimed at enhancing the overall performance of the Board and dealing with identified issues in a constructive way. Their purpose is not to criticise any particular Director but rather generate meaningful feedback and actions for improvement.

Ask potential nominees about the other boards on which they serve and whether they'd be overcommitted if they joined another board. Assuming the interview revealed no negative or worrisome information, before concluding, ask potential candidates if they would be willing to serve if nominated and elected.

A review of the board's agendas is a good way to measure board effectiveness. If the same items are appearing on the agenda with no resolution, it may be an indication that the board lacks the necessary expertise to deal with the issue. Boards should explore the frequency of information exchanges with managers.

For a board to be effective it must take a thoughtful, disciplined and professional approach to its work. This can be done through careful forward planning of board business, efficient operation of board meetings, regular performance assessments and effective chair arrangements.

A board effectiveness review provides feedback for maximising the strengths of directors and boards and highlighting areas for further development. The main purpose of external reviews is to ensure that the board improves its own effectiveness and the company performance.

Here are my favorite characteristics of an outstanding board memberPre-existing passion for the cause.Eagerness to participate at every meeting.Willing to prepare ahead for meetings.Anxious to serve on committees.Ability and propensity to give above average financially.Strong desire for stewardship to others.More items...

In most legal systems, the appointment and removal of directors is voted upon by the shareholders in general meeting or through a proxy statement. For publicly traded companies in the U.S., the directors which are available to vote on are largely selected by either the board as a whole or a nominating committee.

Here are the critical qualities of an effective board member:Dedicated and Committed.Able to lead and influence others.Straightforward and impartial.Knowledgeable and an insatiable learner.Values discretion and confidentiality.

An effective board of directors is a board that has diversity within its members and diversity with its talents. In addition to having a broad demographic, an effective board regularly evaluates each individual member's performance, as well as the board's performance as a whole.

Consider the structure and effectiveness of the four most critical board committeesexecutive, audit, compensation and nominating. Understand what time constraints and other responsibilities board members have beyond the board and determine if there are inherent issues as a result of these other commitments.

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Indiana Checklist Evaluation of Potential Board Member Nominees