BUILDING YOUR BOARD

A majority of business owners we surveyed indicated they have a board of directors in place and reap multiple benefits from their board. However, while a minority, the percentage of business owners without a board of directors or advisory board is sizeable at 32%, highlighting the significant opportunity that exists within this cohort to establish boards to potentially realize some of the same benefits that the other two-thirds of respondents enjoy.

2 IN 3 RESPONDENTS HAVE A BOARD OF DIRECTORS IN PLACE. OF THOSE, THE FOLLOWING PERCENTAGES AGREE WITH THESE STATEMENTS

0%

The board helps them make decisions about their business

0%

The board adds value to the business

0%

The board has helped make business introductions or connections

0%

The board helps or has helped identify future candidates for senior management

Building an effective board of directors with the right people, skills and engagement can significantly improve your company’s performance over the long term.

APPOINT THE RIGHT MIX OF BOARD MEMBERS

To make your board as effective as possible, appoint board members who are a mix of members of the company’s senior management team, board members who represent the family’s interests and values, and independent board members who do not have a link to the family or management. Independent board members may work in the same or related industries as the company; however, there also is value in appointing individuals who work in unrelated industries to provide the board with a unique perspective on the business.

CONSIDER THE COMPOSITION OF RESPONDENTS’ BOARDS

Number of Board Members

0

Average number of board members

0

Average number of independent members that work in the same industry

0

Average number of independent members that work in a different industry

Best Describes Average Tenure of Board of Directors

0%

1-3 years

0%

4-5 years

0%

6-10 years

0%

10+ years

Do Family Members Serve on the Board?

0%

YES

DELEGATE RESPONSIBILITIES

Consider delegating follow-up items and tasks to individual board members or committees based on their experience and willingness to do the work. Committees — comprising a subset of the board with relevant knowledge and skills (e.g., a compensation committee or audit committee) — are often a particularly effective way to delegate, as they offer specialized expertise and can meet separately. Whether you are delegating to committees or individuals, authorize them to reach out to third parties and members of the management team, as appropriate, and report back to the board with their findings.