Board meetings should be times when the board is actively engaged to work on the key strategic goals of your organization. All too often, though, board meetings turn into bored meetings. This is especially true when management runs through a presentation instead of leading a discussion. One of the ways to move off of a passive (boring) style of board meeting and on to an active style is to make it as easy as possible for your board members to review the materials ahead of time.
By far the most common reason why management needs to present materials in the board meeting is because board members haven't reviewed them ahead of time. Sometimes this can be because the materials weren't sent out in time. Some times because members find it too much of a hassle to dig through their email to find the right version of the documents they are supposed to review.
Whatever the reason, iBoardrooms can help. iBoardrooms makes it easy for managers to put together timely packages for members to review, and makes it easy for board members to review those documents by keeping them organized in one place and accessible with one click from email or calendar.
Give iBoardrooms a try free for 30 days. Just click "Sign Up" at the top right of the screen.
By far the most common reason why management needs to present materials in the board meeting is because board members haven't reviewed them ahead of time. Sometimes this can be because the materials weren't sent out in time. Some times because members find it too much of a hassle to dig through their email to find the right version of the documents they are supposed to review.
Whatever the reason, iBoardrooms can help. iBoardrooms makes it easy for managers to put together timely packages for members to review, and makes it easy for board members to review those documents by keeping them organized in one place and accessible with one click from email or calendar.
Give iBoardrooms a try free for 30 days. Just click "Sign Up" at the top right of the screen.
Jul 21, 2016 2:36 pm EDT
If you were to tally the total number of hours your company's managers and staff spend preparing for board meetings, how much do you think it would be? Multiply that by the amount your organization pays its managers and staff per hour, and you may well be looking at a figure in the tens of thousands of dollars. Now think about how much time your board members spend trying to make sure that they have the right version of the board materials, trying to find the dial in information, etc. And then think about how valuable their time is.
Spending time preparing for board meetings is unavoidable, but most companies and non-profits don't do it as efficiently as they could. Are your meeting minutes easily at hand? Are you reinventing the wheel each time you put an agenda together? Are the key corporate documents in a neatly organized and easily accessible archive? Can your board members access all the information they need about upcoming board meetings from their calendar on their desktop or mobile device.
If the answers to these questions are "no" or "not exactly", then you have an opportunity to save your organization's managers, staff and board members a tremendous amount of time and effort by using the right tools. iBoardrooms makes preparing, running and following up on board meetings easy and efficient by automating the things you "have to do" so that you and your board can spend your time on the things that really matter.
Give us a try, free for thirty days. Just click "Sign Up" on the upper right part of the page.
Spending time preparing for board meetings is unavoidable, but most companies and non-profits don't do it as efficiently as they could. Are your meeting minutes easily at hand? Are you reinventing the wheel each time you put an agenda together? Are the key corporate documents in a neatly organized and easily accessible archive? Can your board members access all the information they need about upcoming board meetings from their calendar on their desktop or mobile device.
If the answers to these questions are "no" or "not exactly", then you have an opportunity to save your organization's managers, staff and board members a tremendous amount of time and effort by using the right tools. iBoardrooms makes preparing, running and following up on board meetings easy and efficient by automating the things you "have to do" so that you and your board can spend your time on the things that really matter.
Give us a try, free for thirty days. Just click "Sign Up" on the upper right part of the page.
Jul 14, 2016 8:27 am EDT
If you are still using email to organize your board meetings, you are probably wasting your board members' time as you and they try to keep straight which attachment is the latest board packet and where the conference call details are. Your board members are very busy people and their time is very valuable! Even ten minutes of wasted time, multiplied by each board member and by each meeting you have per year, can be the equivalent of thousands of dollars wasted.
More importantly, running crisp, organized board meetings shows your board that you are focused on using their time productively. Making the most of each board meeting is critical for your organization's success as well as your own. A board portal like iBoardrooms lets you run great board meetings and streamlines the details for your members. Sign Up today and get 30 days free!
More importantly, running crisp, organized board meetings shows your board that you are focused on using their time productively. Making the most of each board meeting is critical for your organization's success as well as your own. A board portal like iBoardrooms lets you run great board meetings and streamlines the details for your members. Sign Up today and get 30 days free!
Jul 7, 2016 9:07 am EDT
A recent study puts U.S. oil reserves at 264 Billion barrels of recoverable oil. A staggering amount that is larger than both Saudi Arabia (212 Billion) and Russia (256 Billion). Looking back over the past 20 years of U.S. energy policy and business strategy around U.S. energy reserves, it is hard to think that anyone would have believed in, say 2006, that U.S. reserves would be the highest in the world ten years later. Back then, many serious minded people were worried about "peak oil" and thought that reserves would only decline in the future.
None of this is to take a position on the future of global oil reserves, but merely to point out that most boards and most people make predictions using straight-line projections of current circumstances. Just as high oil prices were not ultimately sustainable in the 2005 - 2006 timeframe, the current low oil price is also very likely to be unsustainable as well. The real world is highly unpredictable and remarkably unwilling to be tamed by even the mightiest spreadsheet (as useful as such tools are!). Boards of Directors should keep this unpredictability in mind and take to forecasting with a requisite does of humility.
None of this is to take a position on the future of global oil reserves, but merely to point out that most boards and most people make predictions using straight-line projections of current circumstances. Just as high oil prices were not ultimately sustainable in the 2005 - 2006 timeframe, the current low oil price is also very likely to be unsustainable as well. The real world is highly unpredictable and remarkably unwilling to be tamed by even the mightiest spreadsheet (as useful as such tools are!). Boards of Directors should keep this unpredictability in mind and take to forecasting with a requisite does of humility.
Jul 5, 2016 10:14 am EDT
The Financial Times reports today that Boston based asset management firm Fidelity Investments has pulled out of a working group convened by Jamie Dimon of JP Morgan. The group has been working on a set of corporate governance protocols that it hoped would be adopted by a broad set of investment firms and others in order to provide a best practices standard.
It remains to be seen whether the working group will publish their recommendations and what they will be if and when they do. Stay tuned!
It remains to be seen whether the working group will publish their recommendations and what they will be if and when they do. Stay tuned!
Jun 8, 2016 11:34 am EDT
Ever wonder why corporations have boards and where they came from? Check out http://www.iboardroo.ms/history to learn more about the history of boards and directors.
Jun 7, 2016 10:01 am EDT
Sound corporate governance is key to a healthy organization. After a series of missteps related to or catalyzed by governance problems, Moody's downgraded Deutsche Bank's debt earlier today. This is the second downgrade so far this year and highlights the challenges that DB faces as it looks to execute its turnaround plan.
May 24, 2016 12:40 pm EDT
For most organizations, implementing the right board portal will immediately start saving the organization money in reduced printing costs. Over and above the time saved from being able to prepare, run and follow up on board meetings more efficiently, and the advantages of having the latest version of the board documents one click away from every board member, simply not printing and shipping the board packets for each meeting will give you a return on your investment in the right online board portal.
iBoardrooms has the features you need and plans that will work for your budget to generate that ROI. To learn more about the return on investment, click on resources at the top of the page and then on Board Portal Guide. Give iBoardrooms a try free for 30 days by clicking on sign up at the top right of the page.
iBoardrooms has the features you need and plans that will work for your budget to generate that ROI. To learn more about the return on investment, click on resources at the top of the page and then on Board Portal Guide. Give iBoardrooms a try free for 30 days by clicking on sign up at the top right of the page.
May 23, 2016 11:37 am EDT
On the heels of the criticism going back and forth between members of Deutsche Bank's supervisory board (the equivalent to a Board of Directors) this week DB's shareholders voted against a compensation package for DB's senior management.
In what has to be a stinging rebuke for both DB's board and management, investors voted 51.9 percent against the pay package versus 48.1 per cent in favor of it. Though the vote was non-binding, DB's board surely has to take the result very seriously especially considering the fact that the vote against the pay package was the result of a broad based revolt among shareholders and observers of DB, including ISS, one of the leading shareholder governance advisory firms.
In some ways an even more alarming result for DB's board and management is the fact that a proposal for a special audit of DB's top management's conduct in various legal matters only narrowly failed by a margin of 46.4 percent in favor of the audit to 53.6% against. Taken together, these two results are about as clear a vote of no-confidence in DB's board and management as shareholders could have delivered at DB's annual meeting.
In what has to be a stinging rebuke for both DB's board and management, investors voted 51.9 percent against the pay package versus 48.1 per cent in favor of it. Though the vote was non-binding, DB's board surely has to take the result very seriously especially considering the fact that the vote against the pay package was the result of a broad based revolt among shareholders and observers of DB, including ISS, one of the leading shareholder governance advisory firms.
In some ways an even more alarming result for DB's board and management is the fact that a proposal for a special audit of DB's top management's conduct in various legal matters only narrowly failed by a margin of 46.4 percent in favor of the audit to 53.6% against. Taken together, these two results are about as clear a vote of no-confidence in DB's board and management as shareholders could have delivered at DB's annual meeting.
May 20, 2016 9:32 am EDT
This post originally appeared on Quora.
A board makes moving fast easier.
A board makes moving fast easier.
If you want to move fast, it is a lot easier to do so if you can rapidly connect to the right talent, customers, suppliers and investors. The right board members will provide connections to all of these.
If you want to move fast, you may break things, it is better if you have a soft place to land if things stay broken. A board of directors provides limitation of liability to the founders and shareholders of the company. Running a company without a board is like racing a car without airbags. You can do it, but you’re more likely to take risk if you know that that safety equipment is there.
Even the best, most skilled CEOs (Warren Buffett, Richard Branson, Elon Musk) have boards of directors. That’s not only because boards help companies move fast, but also because running a great company is really a team sport.
May 19, 2016 2:15 pm EDT
This post was originally an answer we posted to a question on Quora.
Boards of Directors are an integral part of a corporation. The word corporation stems from the latin corporare meaning “to combine in one body”. When you create a corporation you are, in a legal sense, creating an artificial person. (Bet you didn’t think of company founders as being in the same line of work as Dr. Frankenstein.) That artificial person can then own things and be sued, among other rights.
Boards of Directors are an integral part of a corporation. The word corporation stems from the latin corporare meaning “to combine in one body”. When you create a corporation you are, in a legal sense, creating an artificial person. (Bet you didn’t think of company founders as being in the same line of work as Dr. Frankenstein.) That artificial person can then own things and be sued, among other rights.
A problem arises in that the corporation needs to act through real people and there needs to be some basis for determining whether a CEO of a company (or anyone else) is acting for the corporation or on her own behalf.
The traditional way to solve this problem (the origins of which extend at least back into the middle ages) is to create a board of directors to oversee and be responsible for the actions of the corporation. None of the individual board members, in their capacity as board members, can act individually on behalf of the corporation. But, acting as a group they can make collective decisions for the corporation and, legally, those decisions are the decisions of the corporation, not any of the directors individually.
One decision that a board can make is to appoint a chief executive officer (who might also be a board member) with specified authority to act for the corporation. But the CEO’s ability to act for the corporation extends only as far as the board authorizes. If the board authorizes the CEO to sign contracts in value up to $100K, then the CEO can do that. After that, the CEO needs to get board approval in order for the corporation to enter the contract.
So, you might be saying to yourself, that this seems like a lot of complication and overhead. And perhaps in some ways it is. But the benefits are large. Corporations can sell shares to combine capital from many shareholders, they can enter into contracts that bind the corporation and not any of its individual directors or officers, they can shield their shareholders, directors and officers from liability by assuming that liability to themselves.
Now, in addition to all of this, there are large benefits from having a board of directors in that typically the major investors or donors to the organization sit on the board, those directors are typically great sources of advice for the organization’s management, etc.
But fundamentally, the board exists in order to provide a collective will for the artificial person that a corporation is. By the way, this post isn’t legal advice, I’m not a lawyer and you should get your own independent advice and form your own independent judgment on all these matters.
May 18, 2016 11:52 am EDT
The Norwegian oil fund, one of the largest investors in the world, recently took Volkswagen to task for its poor governance practices. Tying governance to the recent emissions scandal at VW, the fund confirmed to the Financial Times that it would be taking legal action against Volkswagen. The Norwegian fund asserts that VW's management and board have been focused on concentrating control in the hands of the Porsche and Piech families rather than on managing the business in the interests of shareholders.
This is just the latest in a string of challenges for VW. And it highlights the need for all closely held companies to have good governance practices and a great board.
This is just the latest in a string of challenges for VW. And it highlights the need for all closely held companies to have good governance practices and a great board.
May 17, 2016 7:11 am EDT
Another day, another major corporation embarking on an internal investigation. This time it is Facebook that is investigating accusations that its staff filtered out news stories with a conservative slant from making it on to the Facebook platform. If Facebook's board gets involved with the investigation the communications between board members, executives and attorneys need to stay confidential.
But, if Facebook's directors are using outside email addresses, there is no guarantee that the communication stays confidential or privileged. To ensure that, directors need a secure board portal like iBoardrooms. Confidential communications in iBoardrooms never travel over email and never go to third party servers as they do with regular email. So give iBoardrooms a try free for 30 days. Run great board meetings and rest easy knowing your confidential communications will stay confidential.
But, if Facebook's directors are using outside email addresses, there is no guarantee that the communication stays confidential or privileged. To ensure that, directors need a secure board portal like iBoardrooms. Confidential communications in iBoardrooms never travel over email and never go to third party servers as they do with regular email. So give iBoardrooms a try free for 30 days. Run great board meetings and rest easy knowing your confidential communications will stay confidential.
May 13, 2016 5:53 am EDT
Directors never have enough time, so making it easy to schedule board meetings is both challenging, and a big benefit if you can pull it off. iBoardrooms has put a great deal thought into its scheduling system and it allows for a low friction way to get board meetings on the calendar.
The board secretary, or another designated person, can propose a number of meeting times and send those times out to the members of the board. Then, the board members (or their assistants) can easily select the times that work for them. This easy system substantially reduces the amount of back and forth that directors or their assistants have to deal with, freeing them up to focus on your strategy.
The board secretary, or another designated person, can propose a number of meeting times and send those times out to the members of the board. Then, the board members (or their assistants) can easily select the times that work for them. This easy system substantially reduces the amount of back and forth that directors or their assistants have to deal with, freeing them up to focus on your strategy.
May 12, 2016 11:24 am EDT
Boards handle the most sensitive documents your organization has. And, those documents can expose your organization to liability if they aren't handled properly. One of the important ways to handle them properly is to implement a document retention policy. That policy will state how long documents will be retained and at what point they will be deleted.
That policy protects the organization from having stale documents available indefinitely while also permitting the board access to current documents. To implement a document retention policy for your board, you need a board portal like iBoardrooms. Otherwise, board materials are spread over email and on director's personal computers with no way of applying your document retention policy to them. iBoardrooms makes it easy for your directors to have one click access to the documents they need and for your organization to implement and stick to the right retention policy. Give iBoardrooms a try today, free for 30 days.
That policy protects the organization from having stale documents available indefinitely while also permitting the board access to current documents. To implement a document retention policy for your board, you need a board portal like iBoardrooms. Otherwise, board materials are spread over email and on director's personal computers with no way of applying your document retention policy to them. iBoardrooms makes it easy for your directors to have one click access to the documents they need and for your organization to implement and stick to the right retention policy. Give iBoardrooms a try today, free for 30 days.
May 11, 2016 12:37 pm EDT
At iBoardrooms, we believe in growing together with you. With that in mind, we have a partner program that we value very highly. Because we value it so highly, we pay 10% of the subscription fees we collect from subscribers to the iBoardrooms users who invited those subscribers on to our platform, our partners.
Any iBoardrooms user can invite someone else to the system. So anyone can become an iBoardrooms partner. All you need to do is to sign up for a free account on the iBoardrooms system and invite people who will use iBoardrooms to make their boards work better. You don't need to be a paid subscriber to iBoardrooms to invite other people to become paying subscribers. Once you have signed up for an account, or using the account you already have, click on "manage members" to invite others to start using iBoardrooms.
May 10, 2016 12:06 pm EDT
A recent article in the Harvard Business Review (see below) points out that teams that share personal insights with one another are higher performing than teams who don't. This is both because team members are better able to read each other's intent the better they know each other, and also because it brings to the fore the different strengths of the different members of the team.
One of the hallmarks of dysfunctional teams is that they do not recognize the resources that all of the different team members bring to the table. Not recognizing that means that the team isn't able to leverage those strengths. This dynamic is hugely important for boards of directors. A great board understands the different things that each member of the board can bring to the table. The best way for all board members to determine this is for the directors to spend some unstructured time with each other. A lunch before the meeting or dinner afterwards, for example.
It may seem impossible to carve out that much time, but great boards focus on what's important and not simply on what is urgent. Making it a priority and a habit to spend that unstructured time will pay dividends far beyond what you might imagine initially.
https://hbr.org/2016/04/teams-who-share-personal-stories-are-more-effective
One of the hallmarks of dysfunctional teams is that they do not recognize the resources that all of the different team members bring to the table. Not recognizing that means that the team isn't able to leverage those strengths. This dynamic is hugely important for boards of directors. A great board understands the different things that each member of the board can bring to the table. The best way for all board members to determine this is for the directors to spend some unstructured time with each other. A lunch before the meeting or dinner afterwards, for example.
It may seem impossible to carve out that much time, but great boards focus on what's important and not simply on what is urgent. Making it a priority and a habit to spend that unstructured time will pay dividends far beyond what you might imagine initially.
https://hbr.org/2016/04/teams-who-share-personal-stories-are-more-effective
May 9, 2016 10:45 am EDT
iBoardrooms, in addition to being a way to help you schedule, prepare and run great board meetings, is also a tool to help you run an efficient due diligence process. If an investor or potential acquirer is looking at your company, iBoardrooms makes it easy to securely share key documents with that outside party. And, you can track when that outside party looks at your documents, and which of those documents he or she looks at.
Due diligence can be a nerve racking and opaque process. iBoardrooms makes getting and staying organized easy and gives you insight on the progress you are making that is hard to get otherwise. Give iBoardrooms a try free for 30 days. You and your board will be glad you did.
Due diligence can be a nerve racking and opaque process. iBoardrooms makes getting and staying organized easy and gives you insight on the progress you are making that is hard to get otherwise. Give iBoardrooms a try free for 30 days. You and your board will be glad you did.
May 5, 2016 9:44 am EDT
Directors, who are very busy people to begin with, often serve on multiple for-profit and non-profit boards. Many directors find themselves awash either in papers or in tablet computers. Here at iBoardrooms, we recently spoke with a director that has a separate tablet for each board on which he serves!
This needless complexity occurs because other than iBoardrooms, today's board tools do not take into account the fact that many directors serve on multiple boards. iBoardrooms does understand that reality, and allows directors to see all of their board matters in one simple and organized interface. Directors get one easy view of all of their upcoming board meetings across all of the organizations that they work with. Each meeting shows the meeting details (location, dial in, etc.) as well as the materials for that meeting. Key organizational documents are just a click away.
So give iBoardrooms a try free for 30 days. Your directors will be glad you did.
This needless complexity occurs because other than iBoardrooms, today's board tools do not take into account the fact that many directors serve on multiple boards. iBoardrooms does understand that reality, and allows directors to see all of their board matters in one simple and organized interface. Directors get one easy view of all of their upcoming board meetings across all of the organizations that they work with. Each meeting shows the meeting details (location, dial in, etc.) as well as the materials for that meeting. Key organizational documents are just a click away.
So give iBoardrooms a try free for 30 days. Your directors will be glad you did.
May 4, 2016 2:48 am EDT
Diversity of background and experience is critical for Boards. There are so many different challenges that companies face and so many constituencies that are important for their success that having a board with many different perspectives is a big competitive advantage. The latest evidence for this comes from a new paper showing that smaller companies do better than their peers when they put entrepreneurs on their board.
This is only one of many different important perspectives that boards benefit from having. Not many years ago, it was considered unusual to have a board member with significant financial expertise and boards now see that perspective as being essential. Similarly, as AI shows promise, companies operating in markets where that trend is likely to have impacts (autos, finance, etc.) will benefit from having board members with technology expertise.
This is all over and above the benefits of having women and minorities on boards. Even some companies who focus primarily on women, such as Pinterest, have zero women on their boards. Pinterest is a very successful private company, but is there any doubt that it would benefit from having at least one board member who strongly identifies with Pinterest's core user base?
There are many competing priorities that go into shaping the composition of a board. But one of the key themes of this blog is that boards work best when they focus on the strategic issues that their companies face. And it is very important not to let the tyranny of the urgent dictate board matters, including board composition. This is easier said than done, but there are great rewards for those who do it.
This is only one of many different important perspectives that boards benefit from having. Not many years ago, it was considered unusual to have a board member with significant financial expertise and boards now see that perspective as being essential. Similarly, as AI shows promise, companies operating in markets where that trend is likely to have impacts (autos, finance, etc.) will benefit from having board members with technology expertise.
This is all over and above the benefits of having women and minorities on boards. Even some companies who focus primarily on women, such as Pinterest, have zero women on their boards. Pinterest is a very successful private company, but is there any doubt that it would benefit from having at least one board member who strongly identifies with Pinterest's core user base?
There are many competing priorities that go into shaping the composition of a board. But one of the key themes of this blog is that boards work best when they focus on the strategic issues that their companies face. And it is very important not to let the tyranny of the urgent dictate board matters, including board composition. This is easier said than done, but there are great rewards for those who do it.
May 3, 2016 4:13 am EDT
As the US Presidential campaign moves toward the general election in the fall, the FBI investigation into Hillary Clinton's private email server continues. At the heart of the matter is whether Clinton improperly exposed classified information by using an email server external to the State Department while she was Secretary of State.
This ongoing problem for Secretary Clinton is exactly the problem that many boards also face, though they may not know it. Many board members use outside email addresses for board matters and in so doing can very easily expose confidential and/or privileged information. Using their own email for board communication exposes both the company on whose board they serve and also themselves to potential liability.
The solution is a simple and secure board portal like iBoardrooms. iBoardrooms keeps board communications secure and directors from having to be the custodian of records in a lawsuit or investigation. Try iBoardrooms free for 30 days and see for yourself how simple and powerful it is.
This ongoing problem for Secretary Clinton is exactly the problem that many boards also face, though they may not know it. Many board members use outside email addresses for board matters and in so doing can very easily expose confidential and/or privileged information. Using their own email for board communication exposes both the company on whose board they serve and also themselves to potential liability.
The solution is a simple and secure board portal like iBoardrooms. iBoardrooms keeps board communications secure and directors from having to be the custodian of records in a lawsuit or investigation. Try iBoardrooms free for 30 days and see for yourself how simple and powerful it is.
May 2, 2016 2:39 am EDT
Georg Thoma, currently head of the integrity committee of Deutsche Bank's supervisory board, is due to step down in a month after DB's vice chairman Alfred Herling criticized him publically for "overzealousness". Mr. Thoma is stepping down amid what Mr. Herling claims to be a difference of opinion over the costs of the internal investigations that Mr. Thoma oversaw.
All companies are complex organizations and Deutsche Bank is much more complex than most. It also has a history, like many of its peers, of running afoul of its regulators. It may well be that the difference of opinion that Mr. Herling points to is real, rooted in principle on both sides, and not reconcilable. But in many situations like this, there can be an additional layer of confusion that makes matters worse than they otherwise could be.
Did the board set clear expectations for the integrity committee regarding its mandate to conduct internal investigations? Was a clear budget for investigations agreed to in advance? These common sense management discussions may very well have happened at Deutsche Bank, but if they did not, perhaps they could have averted a messy and public spat between DB's directors. Is your board working well and communicating clearly enough to set clear expectations among both management and directors? Do you have the time to ensure that this critical communication happens? These are important questions and ones that all great boards should be on top of.
All companies are complex organizations and Deutsche Bank is much more complex than most. It also has a history, like many of its peers, of running afoul of its regulators. It may well be that the difference of opinion that Mr. Herling points to is real, rooted in principle on both sides, and not reconcilable. But in many situations like this, there can be an additional layer of confusion that makes matters worse than they otherwise could be.
Did the board set clear expectations for the integrity committee regarding its mandate to conduct internal investigations? Was a clear budget for investigations agreed to in advance? These common sense management discussions may very well have happened at Deutsche Bank, but if they did not, perhaps they could have averted a messy and public spat between DB's directors. Is your board working well and communicating clearly enough to set clear expectations among both management and directors? Do you have the time to ensure that this critical communication happens? These are important questions and ones that all great boards should be on top of.
Apr 29, 2016 6:23 am EDT
On the heels of a very impressive quarter, Facebook unveiled a proposal to add a third, non-voting, class of stock to its capital structure. The move is intended to cement founder Mark Zuckerberg's control of Facebook even as he intends to sell a substantial portion of his stake in the company in order to fund his philanthropic interests.
This sort of structure, which separates control from economic interest in the company, is often thought to be a "worst practice" as far as corporate governance is concerned. Only very well regarded companies with highly talented management can typically persuade investors to go along with this kind of structure. In Facebook's case, Mr. Zuckerberg already controls the company due to his large founder's stake in the company's shares. So investors who bought in previously knew, or should have known, that Mr. Zuckerberg could do any number of things with the company including implementing a new non-voting share class.
As always, clear lines of communication is the key. Facebook's board of directors is also now taking on increased responsibility in that they have a fiduciary responsibility to investors who, even in principle, can't remove them from the board. Courts may hold Facebook's board to a higher standard of scrutiny given this structure and the lack of power that Facebook's investors have to make changes to the board.
This sort of structure, which separates control from economic interest in the company, is often thought to be a "worst practice" as far as corporate governance is concerned. Only very well regarded companies with highly talented management can typically persuade investors to go along with this kind of structure. In Facebook's case, Mr. Zuckerberg already controls the company due to his large founder's stake in the company's shares. So investors who bought in previously knew, or should have known, that Mr. Zuckerberg could do any number of things with the company including implementing a new non-voting share class.
As always, clear lines of communication is the key. Facebook's board of directors is also now taking on increased responsibility in that they have a fiduciary responsibility to investors who, even in principle, can't remove them from the board. Courts may hold Facebook's board to a higher standard of scrutiny given this structure and the lack of power that Facebook's investors have to make changes to the board.
Apr 28, 2016 10:45 am EDT
Yahoo announced today that it will add four board members nominated by activist shareholder Starboard Value. Yahoo avoids what might have been a messy proxy fight as it continues to focus on efforts to sell itself to an interested buyer.
As Yahoo brings these new directors on, it will be critically important to ensure clear communication between management and the board as well as among the directors. Transaction discussions can move quickly, with different offers and terms on the table as well as a shifting set of interested parties. The Yahoo directors have a duty to investors to find the best deal they can for the company, even though it can be very unclear, from day to day, which offer can turn into the best deal. Adding murky communication to the mix is not a recipe for success.
At iBoardrooms, we make a simple, powerful board portal that helps executives and directors communicate with each other clearly and easily. We make it easy to schedule, prepare and run great board meetings. But we also make it easy to send secure messages to one another securely. And, we make it easy to keep everyone on the same page, even when the situation is changing rapidly. Have you ever been in a meeting when someone is working from the wrong version of a document? If you are in Yahoo's situation, that's the last thing you need.
So give iBoardrooms a try, free for 30 days.
As Yahoo brings these new directors on, it will be critically important to ensure clear communication between management and the board as well as among the directors. Transaction discussions can move quickly, with different offers and terms on the table as well as a shifting set of interested parties. The Yahoo directors have a duty to investors to find the best deal they can for the company, even though it can be very unclear, from day to day, which offer can turn into the best deal. Adding murky communication to the mix is not a recipe for success.
At iBoardrooms, we make a simple, powerful board portal that helps executives and directors communicate with each other clearly and easily. We make it easy to schedule, prepare and run great board meetings. But we also make it easy to send secure messages to one another securely. And, we make it easy to keep everyone on the same page, even when the situation is changing rapidly. Have you ever been in a meeting when someone is working from the wrong version of a document? If you are in Yahoo's situation, that's the last thing you need.
So give iBoardrooms a try, free for 30 days.
Apr 27, 2016 10:59 am EDT
iBoardrooms is more than just a way to prepare, schedule and run great board meetings. iBoardrooms also provides an easy document library for your key corporate documents. These include the minutes of previous boards meetings and financials, as well as other key strategic documents such as capitalization tables, policy documents, the corporate charter and by laws, and the like.
These documents are not needed often, but are critical when they are needed. iBoardrooms makes it easy to keep these important documents secure, organized and easily accessible for you and all of the members of your board.
These documents are not needed often, but are critical when they are needed. iBoardrooms makes it easy to keep these important documents secure, organized and easily accessible for you and all of the members of your board.
Apr 22, 2016 4:18 am EDT
Volkswagen is close to finalizing a settlement with the U.S. Government over its practice of installing technology in its diesel cars to cheat on emissions testing. The technology allowed diesel Volkswagen cars to detect an emissions test and calibrate the engine for low emissions during the test, while delivering higher performance and higher emissions (higher than those allowed in the U.S.) when not being tested. The settlement to VW owners may be as much as $5,000 and the cost to VW itself as much at 25 billion euros.
The investigators at VW have been stymied by the use of internal code words to refer to the emissions test defeating technology and because the effort dates back at least to the late '90s such that much of the evidence is locked in outdated computer systems. But if the internal investigation does not clear up the issue, U.S. and European investigators and courts may weigh in with more vigor.
All of this points to the need for Volkswagen's board, and all boards, to have a rigorous and thorough investigative ability. Clearly, Volkswagen's board knew, or should have known, that Volkswagen's diesel cars were being sold in the U.S. and elsewhere without the costly emissions cleaning technology used by Mercedes and others. Volkswagen claimed to have developed a low cost version, which actually turned out not to exist, and the results were due to the cheating emissions control software. The kind of technical low cost advantage is typically fleeting in the auto industry where the underlying technologies, like diesel engines, have been well understood for more than a century and where the entire industry is focused on squeezing cost out of the supply chain.
Given that Mercedes and others were never able to deliver similar technology to VW's, VW's board should have at the very least been asking questions about the source of that unusual competitive advantage if only to try and replicate that "success". And had VW's board been able to investigate and understand the nature of the fraud, the company would likely not be facing settlements in the range of 25 billion euros today.
This kind of vigilance is not an easy task, but it is the task that boards have to master in order to be effective stewards of their organizations. To master it, boards need to have a strong sense of independence, experienced members, and an ability to get good, privileged, legal advice. That last requirement also means that boards need an effective board portal, like iBoardrooms, to ensure that their communication stays confidential, and privileged communication stays privileged.
The investigators at VW have been stymied by the use of internal code words to refer to the emissions test defeating technology and because the effort dates back at least to the late '90s such that much of the evidence is locked in outdated computer systems. But if the internal investigation does not clear up the issue, U.S. and European investigators and courts may weigh in with more vigor.
All of this points to the need for Volkswagen's board, and all boards, to have a rigorous and thorough investigative ability. Clearly, Volkswagen's board knew, or should have known, that Volkswagen's diesel cars were being sold in the U.S. and elsewhere without the costly emissions cleaning technology used by Mercedes and others. Volkswagen claimed to have developed a low cost version, which actually turned out not to exist, and the results were due to the cheating emissions control software. The kind of technical low cost advantage is typically fleeting in the auto industry where the underlying technologies, like diesel engines, have been well understood for more than a century and where the entire industry is focused on squeezing cost out of the supply chain.
Given that Mercedes and others were never able to deliver similar technology to VW's, VW's board should have at the very least been asking questions about the source of that unusual competitive advantage if only to try and replicate that "success". And had VW's board been able to investigate and understand the nature of the fraud, the company would likely not be facing settlements in the range of 25 billion euros today.
This kind of vigilance is not an easy task, but it is the task that boards have to master in order to be effective stewards of their organizations. To master it, boards need to have a strong sense of independence, experienced members, and an ability to get good, privileged, legal advice. That last requirement also means that boards need an effective board portal, like iBoardrooms, to ensure that their communication stays confidential, and privileged communication stays privileged.
Apr 21, 2016 5:06 am EDT
Yesterday Intel announced their quarterly earnings and that they would be restructuring their business moving forward. That restructuring includes a layoff of up to 12,000 workers, which is nearly 11% of Intel's workforce. Though Intel's earnings for the quarter beat expectations, PC sales continue to decline at significant rates which is threatening a core source of Intel's revenue and profits.
PC sales have come under pressure from tablets and mobile devices, and because it has been quite a long time since each new generation of processor would enable a significantly better experience for the PC user. Arguably, not since the late '90s or perhaps early 2000's has that been the case.
Intel has reinvented itself once before. Turning from a manufacturer of memory chips, which it was primarily until the early '80s, into today's maker of processors. That reinvention also required significant layoffs and was a painful period for the company, though it laid the foundation for some spectacular successes.
Only time will tell if this new reinvention will allow Intel to position itself successfully in Cloud Computing, Mobile, and the Internet of Things. But, we already know that Intel's leadership and board are willing to take a clear-eyed look at their business and do the things they think are necessary for the company to succeed in the face of changing technology trends. Is your organization's leadership and board willing to shake things up if needed? As Hemingway wrote in The Sun Also Rises, bankruptcy happens in two ways: gradually, then suddenly. If your organization is in the gradually phase, as Intel's leadership seems to believe it is, or may be, it is all to easy to let things slide quarter after quarter. But once things start to happen suddenly, it is too late.
PC sales have come under pressure from tablets and mobile devices, and because it has been quite a long time since each new generation of processor would enable a significantly better experience for the PC user. Arguably, not since the late '90s or perhaps early 2000's has that been the case.
Intel has reinvented itself once before. Turning from a manufacturer of memory chips, which it was primarily until the early '80s, into today's maker of processors. That reinvention also required significant layoffs and was a painful period for the company, though it laid the foundation for some spectacular successes.
Only time will tell if this new reinvention will allow Intel to position itself successfully in Cloud Computing, Mobile, and the Internet of Things. But, we already know that Intel's leadership and board are willing to take a clear-eyed look at their business and do the things they think are necessary for the company to succeed in the face of changing technology trends. Is your organization's leadership and board willing to shake things up if needed? As Hemingway wrote in The Sun Also Rises, bankruptcy happens in two ways: gradually, then suddenly. If your organization is in the gradually phase, as Intel's leadership seems to believe it is, or may be, it is all to easy to let things slide quarter after quarter. But once things start to happen suddenly, it is too late.
Apr 20, 2016 4:34 am EDT
Most boards of directors have requirements around how often they are to meet and about how far in advance the board should be given notice of the time and place of the meeting. Many smaller companies run the risk of not complying with these requirements simply because management gets busy with running the business and having the next board meeting never quite makes it to the top of the list of things that need to get done.
One of the running themes of this blog is that managers of companies and members of boards need to make time to think about matters that are important, but not urgent. These matters tend to be the key strategic issues that really move the needle for organizations. Making sure to have a regularly scheduled board meeting is a good thing not only for compliance purposes, but also in order to carve out time to think about the important and not urgent.
iBoardrooms makes doing this easier for managers and directors by automatically creating reminders to schedule the next board meeting inside the window required. While it seems like a small thing, and in many ways it is, it can really help busy managers and board members to prioritize strategy.
One of the running themes of this blog is that managers of companies and members of boards need to make time to think about matters that are important, but not urgent. These matters tend to be the key strategic issues that really move the needle for organizations. Making sure to have a regularly scheduled board meeting is a good thing not only for compliance purposes, but also in order to carve out time to think about the important and not urgent.
iBoardrooms makes doing this easier for managers and directors by automatically creating reminders to schedule the next board meeting inside the window required. While it seems like a small thing, and in many ways it is, it can really help busy managers and board members to prioritize strategy.
Apr 19, 2016 12:46 pm EDT
As this article from the New York Times discusses, boards, particularly boards of technology companies, are coming under increasing scrutiny for the stock compensation strategies they use. Investors often, but not always, disregard stock compensation when they evaluate the financials of a company particularly when that company's workforce is a key strategic asset as it often is for technology firms.
But when times are tough, investors starting taking a close look at stock compensation. The pressures are two fold, and they work in opposite directions. Investors examine the impact of stock compensation on the companies financials and see the negative impact to earnings and the increased dilution of their stake in the company. This scrutiny leads investors to want the company to scale back the company's use of stock compensation. At the same time, investors are often concerned about whether the company can retain its workforce if the company's stock price declines. Fending off other companies who want to poach talented employees suggests a need to increase stock compensation.
Boards are right in the middle of these competing pressures and need to exercise great care a good judgment in order to set the right strategy for stock compensation in tough times. And, it is critically important to appropriately document that strategy. Tech companies have gotten into hot water in the past, including even luminaries like Steve Jobs, for not adequately documenting stock compensation and following appropriate procedures when implementing changes to a stock compensation plan. Your company's attorneys will be the point people in helping to ensure that these requirements are met, but a board portal is also helpful in order to keep your board organized and its decisions appropriately documented.
But when times are tough, investors starting taking a close look at stock compensation. The pressures are two fold, and they work in opposite directions. Investors examine the impact of stock compensation on the companies financials and see the negative impact to earnings and the increased dilution of their stake in the company. This scrutiny leads investors to want the company to scale back the company's use of stock compensation. At the same time, investors are often concerned about whether the company can retain its workforce if the company's stock price declines. Fending off other companies who want to poach talented employees suggests a need to increase stock compensation.
Boards are right in the middle of these competing pressures and need to exercise great care a good judgment in order to set the right strategy for stock compensation in tough times. And, it is critically important to appropriately document that strategy. Tech companies have gotten into hot water in the past, including even luminaries like Steve Jobs, for not adequately documenting stock compensation and following appropriate procedures when implementing changes to a stock compensation plan. Your company's attorneys will be the point people in helping to ensure that these requirements are met, but a board portal is also helpful in order to keep your board organized and its decisions appropriately documented.
Apr 18, 2016 4:12 am EDT
One of the important features that iBoardrooms offers is the ability to audit all of the activity that occurs on the system. There are times when it is important to know exactly which person entered a particular piece of information into your board portal. For example, if you have multiple people creating a board meeting agenda it can be very helpful to have a record of exactly who did what when. If your organization requires an auditing capability in order to comply with regulation or other rules, the iBoardrooms auditing capability is designed to meet your needs as well.
Apr 14, 2016 4:41 am EDT
In our previous post, we discussed how boards can jeopardize the confidentiality of their communications by using email to communicate with one another. And, by jeopardizing confidentiality, boards also jeopardize their ability to receive privileged legal advice from their attorneys.
As if that weren't bad enough, if your board uses email to communicate and there is an inquiry from a government body or a lawsuit, you and your board members may have exposed yourselves to significant personal liability. Once a subpoena gets issued in an investigation or lawsuit or legal discovery commences, the entity being subpoenaed or that is subject to discovery becomes a "custodian" of relevant documents on behalf of the court with jurisdiction in the matter. The custodian is responsible for identifying, preserving and handing over to the court any and all documents relevant to the discovery process or subpoena.
Typically, when a company is investigated or sued the company is the custodian and is responsible for turning over relevant documents to the court. The company is typically the custodian because the company typically has control of the relevant documents in question. However, in the case of board members, if a board member uses their email address from a different company, or a personal email address, then the individual board member will likely be names as a custodian alongside the company itself.
Circling back to the fictional example from our last post, Bob, board member at Wayne Enterprises and managing director at Gotham National Bank (GNB) uses his GNB email to conduct Wayne Enterprises board related business. Once an investigation starts into misappropriation of resources and misrepresentation in the accounting at Wayne Enterprises due to company resources being diverted in order to secretly fund a masked vigilante, then Bob will very likely be named personally as a custodian of records in that investigation due to his using his GNB email address.
Once Bob is named as a custodian, Bob is personally responsible for turning over the relevant documents to the court in a timely fashion. If Bob won't or can't do that, Bob can be subject to significant penalties including criminal penalties. If GNB has a policy that it will not turn over emails unless GNB itself is subpoenaed (which it has not been in our example because the Wayne Enterprises investigation has nothing to do with GNB) then it is up to Bob to figure out how to convince GNB otherwise or else the court can hold Bob responsible.
For you and your board members, keeping your board communications off of email is the best way to avoid opening yourselves up to this source of potentially very severe personal liability. And even though your company is probably not run by a masked superhero (though if it is, please let us know as that would be awesome) real people find themselves in this kind of sticky situation all the time. Companies get investigated and sued for all kinds of reasons, some of them merited and some of them frivolous, all the time. And whether the investigation or lawsuit has a reasonable basis or not, there can be discovery and/or subpoenas regardless. So even if there is no good reason in the first place, if you or your board members are named a custodian, you are subject to potentially severe personal liability.
The way to avoid getting caught between a rock and a hard place in this area is to use iBoardrooms. iBoardrooms provides a secure messaging tool to let you and communicate with your board without using email and with all of the records staying with your company. That way in any investigation or lawsuit your company, and not you or any of your board members personally, will be named as the custodian of those records. iBoardrooms is a board portal that gives you the tools to run great board meetings. Great board meetings are meetings where your board can really focus on the key strategic issues that drive success for your organization. iBoardrooms lets your board keep the focus on strategy, without needing to be distracted by scary personal liability issues like being a custodian of documents or by administrative trivia. Give us a try free for thirty days.
As if that weren't bad enough, if your board uses email to communicate and there is an inquiry from a government body or a lawsuit, you and your board members may have exposed yourselves to significant personal liability. Once a subpoena gets issued in an investigation or lawsuit or legal discovery commences, the entity being subpoenaed or that is subject to discovery becomes a "custodian" of relevant documents on behalf of the court with jurisdiction in the matter. The custodian is responsible for identifying, preserving and handing over to the court any and all documents relevant to the discovery process or subpoena.
Typically, when a company is investigated or sued the company is the custodian and is responsible for turning over relevant documents to the court. The company is typically the custodian because the company typically has control of the relevant documents in question. However, in the case of board members, if a board member uses their email address from a different company, or a personal email address, then the individual board member will likely be names as a custodian alongside the company itself.
Circling back to the fictional example from our last post, Bob, board member at Wayne Enterprises and managing director at Gotham National Bank (GNB) uses his GNB email to conduct Wayne Enterprises board related business. Once an investigation starts into misappropriation of resources and misrepresentation in the accounting at Wayne Enterprises due to company resources being diverted in order to secretly fund a masked vigilante, then Bob will very likely be named personally as a custodian of records in that investigation due to his using his GNB email address.
Once Bob is named as a custodian, Bob is personally responsible for turning over the relevant documents to the court in a timely fashion. If Bob won't or can't do that, Bob can be subject to significant penalties including criminal penalties. If GNB has a policy that it will not turn over emails unless GNB itself is subpoenaed (which it has not been in our example because the Wayne Enterprises investigation has nothing to do with GNB) then it is up to Bob to figure out how to convince GNB otherwise or else the court can hold Bob responsible.
For you and your board members, keeping your board communications off of email is the best way to avoid opening yourselves up to this source of potentially very severe personal liability. And even though your company is probably not run by a masked superhero (though if it is, please let us know as that would be awesome) real people find themselves in this kind of sticky situation all the time. Companies get investigated and sued for all kinds of reasons, some of them merited and some of them frivolous, all the time. And whether the investigation or lawsuit has a reasonable basis or not, there can be discovery and/or subpoenas regardless. So even if there is no good reason in the first place, if you or your board members are named a custodian, you are subject to potentially severe personal liability.
The way to avoid getting caught between a rock and a hard place in this area is to use iBoardrooms. iBoardrooms provides a secure messaging tool to let you and communicate with your board without using email and with all of the records staying with your company. That way in any investigation or lawsuit your company, and not you or any of your board members personally, will be named as the custodian of those records. iBoardrooms is a board portal that gives you the tools to run great board meetings. Great board meetings are meetings where your board can really focus on the key strategic issues that drive success for your organization. iBoardrooms lets your board keep the focus on strategy, without needing to be distracted by scary personal liability issues like being a custodian of documents or by administrative trivia. Give us a try free for thirty days.
Apr 13, 2016 7:41 am EDT
To receive iBoardrooms's guides to preparing, running and following up on great board meetings as well as our guide to board portals, sign up below.
Many times boards need to deal with sensitive topics that, appropriately, call for the advice of seasoned legal counsel. These communications have long been held to be privileged, in that courts and investigators do not have the authority to access these communications. This privilege exists so that clients and attorneys can have a full and frank exchange of views so that the attorney can best advise the client on the proper course of action to take.
There are important exceptions to the attorney-client privilege, however. These exceptions permit courts to compel the disclosure of communications between attorneys and their clients. One such well recognized exception is that if the attorney and the client have not made efforts to keep the communication confidential, then a court may examine the communication that would otherwise be privileged.
Given the way communication among and between board members and attorneys happens today, many communications that boards and board members assume will be privileged, may in fact not be. To take a fictional example, say that the board of Wayne Enterprises is conducting an investigation into whether someone has been misappropriating company resources on a large scale and also fraudulently doctoring the financial statements of the company so as to make it appear that these resources are being spent on defense related research and development.
This activity, if known, would likely attract the attention of the SEC, Department of Defense and local law enforcement not to mention spur widespread media interest. The Wayne Enterprises board, upon having suspicions that something was amiss, would prudently get advice about the issue from its general counsel and likely also outside counsel. The board would presume that the advice they receive from their attorneys on the matter is protected by attorney-client privilege.
However, one of the members of the Wayne Enterprises board, let's call him Bob, is also a managing director at the Gotham National Bank (GNB). Like many directors, Bob uses his main business email account (in his case at GNB) for most business related matters - including matters related to the Wayne Enterprises board. GNB, as a registered broker dealer, uses standard monitoring tools on its email system to ensure that employees are complying with FINRA guidelines and other relevant regulations. Once Bob receives an email from Wayne Enterprises general counsel, GNB's automatic monitoring flags it as having several keywords that require review.
At that point, GNB's general counsel calls Bob demanding to know why he is getting an email with such potentially explosive content, and why wasn't he told about it in advance? While GNB can quickly be assured that this matter has nothing to do with them, Wayne Enterprises now has to wonder whether their communications are still confidential. And if they are not confidential, can they rely on attorney-client privilege to keep them out of the gaze of an inquiry?
If you are a CEO, a member of a board, are the general counsel of a company, or otherwise involved in a board's functioning, this issue is something you should be thinking hard about. And the leakiness of email communication isn't limited only to the scenario above. Email providers routinely monitor the content of email in order to serve advertising to their customers and for many other purposes. For all these reasons, boards should not trust email for their confidential or privileged communications. Instead, use a dedicated board portal like iBoardrooms that keeps of the board communication confidential and off of outside email systems. Give us a try free for thirty days.
There are important exceptions to the attorney-client privilege, however. These exceptions permit courts to compel the disclosure of communications between attorneys and their clients. One such well recognized exception is that if the attorney and the client have not made efforts to keep the communication confidential, then a court may examine the communication that would otherwise be privileged.
Given the way communication among and between board members and attorneys happens today, many communications that boards and board members assume will be privileged, may in fact not be. To take a fictional example, say that the board of Wayne Enterprises is conducting an investigation into whether someone has been misappropriating company resources on a large scale and also fraudulently doctoring the financial statements of the company so as to make it appear that these resources are being spent on defense related research and development.
This activity, if known, would likely attract the attention of the SEC, Department of Defense and local law enforcement not to mention spur widespread media interest. The Wayne Enterprises board, upon having suspicions that something was amiss, would prudently get advice about the issue from its general counsel and likely also outside counsel. The board would presume that the advice they receive from their attorneys on the matter is protected by attorney-client privilege.
However, one of the members of the Wayne Enterprises board, let's call him Bob, is also a managing director at the Gotham National Bank (GNB). Like many directors, Bob uses his main business email account (in his case at GNB) for most business related matters - including matters related to the Wayne Enterprises board. GNB, as a registered broker dealer, uses standard monitoring tools on its email system to ensure that employees are complying with FINRA guidelines and other relevant regulations. Once Bob receives an email from Wayne Enterprises general counsel, GNB's automatic monitoring flags it as having several keywords that require review.
At that point, GNB's general counsel calls Bob demanding to know why he is getting an email with such potentially explosive content, and why wasn't he told about it in advance? While GNB can quickly be assured that this matter has nothing to do with them, Wayne Enterprises now has to wonder whether their communications are still confidential. And if they are not confidential, can they rely on attorney-client privilege to keep them out of the gaze of an inquiry?
If you are a CEO, a member of a board, are the general counsel of a company, or otherwise involved in a board's functioning, this issue is something you should be thinking hard about. And the leakiness of email communication isn't limited only to the scenario above. Email providers routinely monitor the content of email in order to serve advertising to their customers and for many other purposes. For all these reasons, boards should not trust email for their confidential or privileged communications. Instead, use a dedicated board portal like iBoardrooms that keeps of the board communication confidential and off of outside email systems. Give us a try free for thirty days.
Apr 12, 2016 5:22 am EDT
An article from the Financial Times suggests that auto insurance firms should expect their premium revenue to fall by as much as $20B over the next ten years due to the effects of driver assistance technology. These assistive technologies like auto braking assist, blind spot warnings and backup cameras, will drive down the rate of accidents as they become widely adopted forcing auto insurers, in turn, to cut their rates in order to stay competitive.
This story, like so many others, shows how all companies, from a strategic perspective, are really technology companies. Even if a company isn't engaged in technology development itself, and even if it its own operations aren't being significantly transformed by technology, technology can and does significantly affect the strategic landscape within which it operates.
Board members need to keep abreast of these technology trends and, just as importantly, need to be able to carve out the time to reflect on the implications of these trends for the organizations that they have in their care. There is no magic solution for this, and no substitute for considered judgment and accumulated experience. But, there are certainly approaches that can help boards, such as using technology to help carve out time to reflect on these trends. Does your board take the time to discuss the impact of technology trends on your organization during your board meetings? At iBoardrooms, we can help you drive the strategic conversation forward for your board. Give us a try today.
This story, like so many others, shows how all companies, from a strategic perspective, are really technology companies. Even if a company isn't engaged in technology development itself, and even if it its own operations aren't being significantly transformed by technology, technology can and does significantly affect the strategic landscape within which it operates.
Board members need to keep abreast of these technology trends and, just as importantly, need to be able to carve out the time to reflect on the implications of these trends for the organizations that they have in their care. There is no magic solution for this, and no substitute for considered judgment and accumulated experience. But, there are certainly approaches that can help boards, such as using technology to help carve out time to reflect on these trends. Does your board take the time to discuss the impact of technology trends on your organization during your board meetings? At iBoardrooms, we can help you drive the strategic conversation forward for your board. Give us a try today.
Apr 11, 2016 4:26 am EDT
As the proxy season is soon to arrive, companies with shareholder meetings on the calendar have much to think about. The ongoing drive towards "Proxy Access" with which shareholders would be able to nominate directors without going through a full fledged proxy fight is increasing the pressure on companies to show shareholders that their boards, as presently constituted, are productive and making the right strategic choices.
One way to do this is to show that the board is meeting productively and efficiently, keeping strategic issues front and center. Particularly if shareholders are pressuring the company needs to embrace technology, having the board embrace technology in the form of a board portal can be a great way to show responsiveness to shareholder desires and also improve the board's efficiency at the same time. At iBoardrooms, our board portal is designed to do just that. Give us a try today, free for thirty days.
One way to do this is to show that the board is meeting productively and efficiently, keeping strategic issues front and center. Particularly if shareholders are pressuring the company needs to embrace technology, having the board embrace technology in the form of a board portal can be a great way to show responsiveness to shareholder desires and also improve the board's efficiency at the same time. At iBoardrooms, our board portal is designed to do just that. Give us a try today, free for thirty days.
Apr 8, 2016 6:18 am EDT
Boards of Directors examine and handle the most confidential and sensitive documents that organizations have. And they want to be able to access that information in a timely fashion, and to be able to reference past documents in order to understand key trends over time. But at a certain point, keeping those documents around can create more problems than they solve.
For this reason, many companies implement document retention policies that strike a balance in order to keep documents on file for reference for the right amount of time, but not too long. Those document retention policies often don't apply to boards, not because it wouldn't be a good idea to implement them, but because board members bring documents outside of the company's control and the policies can't be effectively implemented.
As a result, documents that should be deleted per company document retention policies are instead still available for discovery in the case of litigation. iBoardrooms provides a solution for this problem. iBoardrooms has a cloud-based document library that board members can easily access in order to effectively do their job of providing oversight for the organization. But because this document library remains within the iBoardrooms platform, it can be controlled and compliant with your organizations' document retention policies. Give us a try today, free for 30 days.
For this reason, many companies implement document retention policies that strike a balance in order to keep documents on file for reference for the right amount of time, but not too long. Those document retention policies often don't apply to boards, not because it wouldn't be a good idea to implement them, but because board members bring documents outside of the company's control and the policies can't be effectively implemented.
As a result, documents that should be deleted per company document retention policies are instead still available for discovery in the case of litigation. iBoardrooms provides a solution for this problem. iBoardrooms has a cloud-based document library that board members can easily access in order to effectively do their job of providing oversight for the organization. But because this document library remains within the iBoardrooms platform, it can be controlled and compliant with your organizations' document retention policies. Give us a try today, free for 30 days.
Apr 7, 2016 5:02 am EDT
Many times firms need to open their books and other corporate documents to third parties. Typically, this can happen during negotiations for a merger with or acquisition by that third party. These third parties want to see financials as well as corporate records including board of directors meeting minutes. There are a few different challenges with doing this that you'll want to be sure you have a handle on such as:
Do you know where all of the documents are that the outside party will want to see?
Can you make those documents available easily and securely?
Can you easily change which documents are available if the focus of diligence changes?
Can you track which documents the outside party has seen?
Can you end the outside party's access if the conversation with them ends?
At iBoardrooms, we have integrated a virtual dataroom into our board portal to make it easy to make the right documents securely available to outside parties, change which documents those are easily, track access to them and shutdown that access whenever you need to. Managing this process can be extremely time intensive and expensive, but iBoardrooms makes it easy. Give us a try for 30 days free and find out for yourself.
Do you know where all of the documents are that the outside party will want to see?
Can you make those documents available easily and securely?
Can you easily change which documents are available if the focus of diligence changes?
Can you track which documents the outside party has seen?
Can you end the outside party's access if the conversation with them ends?
At iBoardrooms, we have integrated a virtual dataroom into our board portal to make it easy to make the right documents securely available to outside parties, change which documents those are easily, track access to them and shutdown that access whenever you need to. Managing this process can be extremely time intensive and expensive, but iBoardrooms makes it easy. Give us a try for 30 days free and find out for yourself.
Apr 6, 2016 6:39 am EDT
One of the problems with managing board meetings using traditional email and other tools is that your board members' computers and tablets have their board books/packets and other board materials on them. If a board member loses their computer or tablet, or it gets stolen, it represents an enormous security breach for your organization.
Hosting your board portal in the Cloud, like iBoardrooms does, allows board members to have easy access to their board materials, but keeps them off of their computers and tablets. Not only is there no software for your board members to install, but the security of your confidential materials is much better than it is when you use email or other traditional tools.
Hosting your board portal in the Cloud, like iBoardrooms does, allows board members to have easy access to their board materials, but keeps them off of their computers and tablets. Not only is there no software for your board members to install, but the security of your confidential materials is much better than it is when you use email or other traditional tools.
Apr 5, 2016 5:57 am EDT
One of the most frustrating things about coordinating a virtual meeting can be finding an available conference bridge. iBoardrooms makes finding and using a conference line easy. If you already have conference bridges, iBoardrooms will remember those details for you so that you can select a convenient bridge. Then, iBoardrooms makes sure that all of your board members have easy access to the conference bridge details, putting them into the agendas, meeting invitations and, for members using smartphones, letting them access the conference bridge with one tap from their calendar.
If you need a conference line, iBoardrooms makes that very easy as well. With just a few clicks you can provision a secure, dedicated conference bridge for your board and use either a local or toll-free number. These sorts of logistical issues are what iBoardrooms makes easy. Try us free for 30 days to see how we can help you run great board meetings.
If you need a conference line, iBoardrooms makes that very easy as well. With just a few clicks you can provision a secure, dedicated conference bridge for your board and use either a local or toll-free number. These sorts of logistical issues are what iBoardrooms makes easy. Try us free for 30 days to see how we can help you run great board meetings.
Apr 4, 2016 3:41 am EDT
One of the most challenging things about managing a Board of Directors is also one of the conceptually simplest. How to find a time for your board meeting that works for everyone on the board. Board members are always exceptionally busy people, and finding a time for a board meeting that works for all, or even most, of them can be very difficult.
There's no magic solution for this problem, but there are tools that can make it easier. Rather than sending out a proposed meeting time, best practice is to send out a list of meeting times, and then let each board member select the times that work for them. That way you get a list of times and you can see which ones work for everyone, if there are any, and which ones work for the most members. iBoardrooms incorporates a tool like this so that members can indicate workable meeting times and you can get the meeting scheduled and use your board's time for strategic thinking rather that scheduling logistics.
There's no magic solution for this problem, but there are tools that can make it easier. Rather than sending out a proposed meeting time, best practice is to send out a list of meeting times, and then let each board member select the times that work for them. That way you get a list of times and you can see which ones work for everyone, if there are any, and which ones work for the most members. iBoardrooms incorporates a tool like this so that members can indicate workable meeting times and you can get the meeting scheduled and use your board's time for strategic thinking rather that scheduling logistics.
Apr 1, 2016 6:50 am EDT
A recent story in the New York Times about the NBA's Golden State Warriors, shows the importance of open lines of communication in an organization.
Golden State, a team trying to break the record for most regular season wins in NBA history, have been reinvented by their ownership group since 2010. Turning them from a perennial bottom dweller into the best team in the association. One of the keys to their success has, undoubtedly, been Stephen Curry, the league's best player. But another key to their success has been a willingness to keep open lines of communication with all of the members of the team, the management and the staff. As the New York Times article linked to above points out, one of the keys to defending LeBron James, the star player for the Cleveland Cavaliers in the NBA finals was a technique noticed by one of the video coordinators on the team.
A video coordinator on an NBA team is, as the title implies, not a senior position, but head coach Steve Kerr listened to the advice, incorporated it into the Warriors' game plan and won the NBA title. Keeping that kind of open communication is critical for every organization and is particularly critical among board members. iBoardrooms provides secure, private communication tools to make communicating with other board members easy. Give us a try and help your team win it all.
Golden State, a team trying to break the record for most regular season wins in NBA history, have been reinvented by their ownership group since 2010. Turning them from a perennial bottom dweller into the best team in the association. One of the keys to their success has, undoubtedly, been Stephen Curry, the league's best player. But another key to their success has been a willingness to keep open lines of communication with all of the members of the team, the management and the staff. As the New York Times article linked to above points out, one of the keys to defending LeBron James, the star player for the Cleveland Cavaliers in the NBA finals was a technique noticed by one of the video coordinators on the team.
A video coordinator on an NBA team is, as the title implies, not a senior position, but head coach Steve Kerr listened to the advice, incorporated it into the Warriors' game plan and won the NBA title. Keeping that kind of open communication is critical for every organization and is particularly critical among board members. iBoardrooms provides secure, private communication tools to make communicating with other board members easy. Give us a try and help your team win it all.
Mar 31, 2016 5:21 am EDT
The Wall Street Journal reports that an increasing number of companies are encouraging their senior executives to sit on boards of directors at other companies because it is an important part of their development as corporate leaders.There are recruiting firms who have come to offer reverse board searches. Rather than looking to fill a board seat on behalf of a board, in this case the recruiters are looking for a board seat on behalf of an executive.
Being a CEO is a very different role than being a senior executive, and one of the main reasons is because the CEO needs to manage their board and be comfortable being managed by them. Companies are right to want executives that are being groomed for the CEO spot to gain board experience. Additionally, senior executives are well served to get the broader view of an industry that a board seat affords.
Being a CEO is a very different role than being a senior executive, and one of the main reasons is because the CEO needs to manage their board and be comfortable being managed by them. Companies are right to want executives that are being groomed for the CEO spot to gain board experience. Additionally, senior executives are well served to get the broader view of an industry that a board seat affords.
Mar 30, 2016 5:19 am EDT
Natthan Mesfin was recently elected to the board of Downtown Streets Team, a San Francisco non-profit with a mission to end homelessness. Natthan is passionate about ending homelessness having recently raised money to buy sleeping bags for homeless people and then distributing them himself. In the first year, Natthan raised $2,000 for the effort and in the second year, $5,000.
The most remarkable thing about this story, Natthan is 11 years old. Natthan's passion and new ideas are helping Downtown Streets Team further their mission. As you look for the right board members to help you build your non-profit, be sure to look for people with a passion for your mission, like Natthan.
The most remarkable thing about this story, Natthan is 11 years old. Natthan's passion and new ideas are helping Downtown Streets Team further their mission. As you look for the right board members to help you build your non-profit, be sure to look for people with a passion for your mission, like Natthan.
Mar 29, 2016 5:17 am EDT
The best organizations run well, in large part, due to the unsung efforts of the team of executive assistants supporting their leadership. At iBoardrooms, we get that. So, we make sure that board members' executive assistants have access to all of their member's tools and documents on the iBoardrooms platform. Just as with all other users, iBoardrooms can keep an auditable record of executive assistants' actions on the platform so it is always clear when a member does something on the platform vs their EA.
With this level of access, EAs can ensure that their principal has the documents and information they need, when they need it. And, iBoardrooms fits into the process and rhythm that members and their EAs have established already.
With this level of access, EAs can ensure that their principal has the documents and information they need, when they need it. And, iBoardrooms fits into the process and rhythm that members and their EAs have established already.
Mar 28, 2016 2:24 am EDT
CALPERS, the California pension system that manages $280 billion in assets, came out this month with a policy position stating that directors can be "compromised" after serving 12 years on a board. A number of other observers agree with them. In France, as the Wall Street Journal noted in an article on this topic, directors lose their independent status after 12 years of service and are considered insiders after that point.
But others contend that long service on a board allows directors to more effectively understand the businesses that they oversee as well as stand up more effectively to long time managers. Regardless, having an effective board has never been more important. As investors become more active in their engagement with companies (as the boards and management of Valeant, Yahoo and United Continental are experiencing now) boards and executives need to be managing their organizations actively and effectively to stay ahead of the activists' demands. Sometimes these demands are appropriate (as they certainly seem to be in Valeant's case) and some times less so. But either way boards need to be on top of their game.
At iBoardrooms, we're here to help boards build great organizations. Whether large or small, for-profit or non-profit, boards need the right tools to succeed. Give us a try today and see how we can streamline your board's operations so you can focus on the key strategic issues that really matter.
But others contend that long service on a board allows directors to more effectively understand the businesses that they oversee as well as stand up more effectively to long time managers. Regardless, having an effective board has never been more important. As investors become more active in their engagement with companies (as the boards and management of Valeant, Yahoo and United Continental are experiencing now) boards and executives need to be managing their organizations actively and effectively to stay ahead of the activists' demands. Sometimes these demands are appropriate (as they certainly seem to be in Valeant's case) and some times less so. But either way boards need to be on top of their game.
At iBoardrooms, we're here to help boards build great organizations. Whether large or small, for-profit or non-profit, boards need the right tools to succeed. Give us a try today and see how we can streamline your board's operations so you can focus on the key strategic issues that really matter.
Mar 25, 2016 5:02 am EDT
Krispy Kreme has had its stock decline sharply, not because of any problem with its famous doughnuts, but because the price of oil has gone down. At first blush it is hard to see what the price of oil has to do with Krispy Kreme's business, but it turns out that Krispy Kreme's business is highly sensitive to oil prices.
As Forbes reports, Krispy Kreme's stock price is suffering because the company had embarked on an aggressive campaign of expansion into foreign markets, many of whose economies are down due to the fall in oil prices. Places like Saudi Arabia and Mexico are now home to many Krispy Kreme stores.
And while a doughnut company reeling from a fall in oil prices may seem unique, this kind of thing happens all the time. And not only due to overseas expansion, but also due to factors such as litigation, technological change, international conflict and many other factors upend the day to day business of organizations constantly. Boards need to keep their eye on the horizon to be watchful for these kinds of issues, and the only way to do that is to carve out enough time to understand the organization and the broader strategic trends that affect it.
The iBoardrooms board portal helps both executives and boards of directors focus on the strategic questions that really move the needle. Give us a try today free for 30 days.
As Forbes reports, Krispy Kreme's stock price is suffering because the company had embarked on an aggressive campaign of expansion into foreign markets, many of whose economies are down due to the fall in oil prices. Places like Saudi Arabia and Mexico are now home to many Krispy Kreme stores.
And while a doughnut company reeling from a fall in oil prices may seem unique, this kind of thing happens all the time. And not only due to overseas expansion, but also due to factors such as litigation, technological change, international conflict and many other factors upend the day to day business of organizations constantly. Boards need to keep their eye on the horizon to be watchful for these kinds of issues, and the only way to do that is to carve out enough time to understand the organization and the broader strategic trends that affect it.
The iBoardrooms board portal helps both executives and boards of directors focus on the strategic questions that really move the needle. Give us a try today free for 30 days.
Mar 24, 2016 5:24 am EDT
Fred Wilson, a venture capitalist with Union Square Ventures, writes that one of the companies in which he has invested is starting up an on boarding process for new board members much like companies have with new employees. This makes a tremendous amount of sense. It often takes new board members a long time to come up to speed when they have only materials to review and quarterly meetings. Having an on boarding process helps your new board members be productive quickly.
As Fred Wilson says, this on boarding process is best when the board member takes a day or two to meet with the executive team, sit in on meetings and get a feel for how the organization works. Try it with your next new board member and see how it improves your ability to focus on the issues that really matter in your next meeting.
As Fred Wilson says, this on boarding process is best when the board member takes a day or two to meet with the executive team, sit in on meetings and get a feel for how the organization works. Try it with your next new board member and see how it improves your ability to focus on the issues that really matter in your next meeting.
Mar 22, 2016 8:02 am EDT
Because iBoardrooms is cloud based, you do not need to install any software in order to use it. You can get up and running quickly using the iBoardrooms website to run board meetings and keep board documents organized easily and securely. There is no need to call IT in order to get them to install or provision any systems. All you and your members need is a computer and/or mobile device with a web browser in order to use iBoardrooms.
In fact, you can get up and running with iBoardrooms in about five minutes. Just click the Sign Up link at the top of this page and you'll be up and running in no time.
In fact, you can get up and running with iBoardrooms in about five minutes. Just click the Sign Up link at the top of this page and you'll be up and running in no time.
Mar 21, 2016 3:26 am EDT
Board meetings often conjure up a picture of directors gathered around the table in the boardroom. But today, board meetings are as often held via conference call, with directors spread out over the globe. Both directors and executives often have very busy travel schedules and getting all of them in the same place at the same time can be challenging. In order to help your board work well given this reality, members need to be able to access what they need while they are on the go.
Directors, like everyone else, are used to being able to do practically everything using their smartphone. Today, because the typical assumption is that directors will be in the boardroom, board materials get sent via email, or perhaps printed and neither option works well for a director dialing in to a meeting and expecting to use their smartphone to get what they need. iBoardrooms is designed to work whether your meeting is in person or whether your directors are on the run and using their mobile devices. On mobile, directors can access the meeting agenda and all of the supporting documents right from their calendar, making it easy to fully participate while on the go. Give us a try today. It's free for thirty days.
Directors, like everyone else, are used to being able to do practically everything using their smartphone. Today, because the typical assumption is that directors will be in the boardroom, board materials get sent via email, or perhaps printed and neither option works well for a director dialing in to a meeting and expecting to use their smartphone to get what they need. iBoardrooms is designed to work whether your meeting is in person or whether your directors are on the run and using their mobile devices. On mobile, directors can access the meeting agenda and all of the supporting documents right from their calendar, making it easy to fully participate while on the go. Give us a try today. It's free for thirty days.
Mar 18, 2016 5:27 am EDT
Valeant's shares suffered a 50% decline earlier in the week and the company warned that it may default on its $30B debt. The cause of the debt warning is that the company is not sure whether it will be able to file its earnings report on a timely basis, which would breach covenants in the company's bonds.
The straw that broke the camel's back was a press release that the company issued forecasting $6.4B in adjusted earnings in the 12 months starting in April. But a slide deck that accompanied that press release forecast $6.0B in adjusted earnings over the same time period. The company was forced to issue a correction to the press release stating that $6.0B is the correct forecast. It has been widely reported that there are significant differences of opinion among Valeant's board members and management about the right way to forecast its earnings. The press release / slide deck mix up brought that disagreement to the forefront.
At iBoardrooms, we blogged recently about how important it is to keep documents organized so that board members and executives aren't working off of different versions, which is what we call being a Version Victim. Valeant shows just how important keeping things organized is, especially in times of stress and confusion. For Valeant, the stock price is down roughly 80% from its peak and there are serious questions about whether it will be able to continue its previous strategy of making strategic acquisitions in the healthcare space.
Don't be a Version Victim. Stay organized, especially in tough times. Try iBoardrooms for 30 days free and see how we can help.
The straw that broke the camel's back was a press release that the company issued forecasting $6.4B in adjusted earnings in the 12 months starting in April. But a slide deck that accompanied that press release forecast $6.0B in adjusted earnings over the same time period. The company was forced to issue a correction to the press release stating that $6.0B is the correct forecast. It has been widely reported that there are significant differences of opinion among Valeant's board members and management about the right way to forecast its earnings. The press release / slide deck mix up brought that disagreement to the forefront.
At iBoardrooms, we blogged recently about how important it is to keep documents organized so that board members and executives aren't working off of different versions, which is what we call being a Version Victim. Valeant shows just how important keeping things organized is, especially in times of stress and confusion. For Valeant, the stock price is down roughly 80% from its peak and there are serious questions about whether it will be able to continue its previous strategy of making strategic acquisitions in the healthcare space.
Don't be a Version Victim. Stay organized, especially in tough times. Try iBoardrooms for 30 days free and see how we can help.
Mar 17, 2016 6:41 am EDT
According to a recent article in the Financial Times, there is an epidemic of fraud going on that has affected more than 12,000 businesses around the world. The scheme involves a criminal group carefully crafting an email to appear as if it is coming from the CEO of a company. They then send this email to one of the senior executives of the firm and instruct him or her to wire money to an offshore account under control of the criminals.
This scheme combines a dose of hacking with an ample serving of chutzpah. But, thousands of businesses around the world have fallen for the scheme, in at least one case for as much as $90 million! For boards of directors, this is a scary trend and one that requires both tackling new challenges and getting back to basics. All companies, large and small, need to be on their guard against hacking. Cyber security is rapidly moving to being a core issue for all companies. Many of the most devastating hacking attacks take forms much like this 'CEO scam' in which there is a small amount of technology (in this case the fraudulently crafted email) and a large dose of what hackers call 'social engineering', i.e. traditional con artistry.
The best defense against this sort of scam is three fold: First, to ensure the board members and senior executives are up to date on the proper use of technology so that they can detect these sorts of scams. Even the most well crafted fraudulent email of this type will have some telltale, but subtle, signs that it is malicious. Second, company technologists need to be on the lookout for these sorts of fraudulent emails in order to screen out as many they can. Though no spam filter is perfect (and this sort of email is a kind of particularly nasty spam) they can certainly help.
Third, and most importantly, it is critical for boards to have the right controls in place in order to safeguard company assets. If, as CEO, you sent an email to a member of your team asking them to wire $90M to an offshore account, would they do it without checking with you? Who else in the organization would need to authorize a transaction like that, if anyone? As a board member, are you comfortable that the organization's controls for approving the disbursal of funds are good enough so that a scam like this would be caught? Are you confident that the executive team knows what the controls are, or at least where to find the documents that describe them?
In many ways, the more things change, the more they stay the same. It has always been critically important that boards implement the right controls to balance the need for organizational agility with the need to maintain good stewardship of the organization's assets. At iBoardrooms, we can help you do that. With a simple repository of key corporate documents (such as a payment authorization policy) that executives and board members can easily access to ensure that the payments they are making are legitimate and approved by the right people in the company, iBoardrooms makes it easy for organizations to be both agile and secure. Try us free for thirty days to find out more.
This scheme combines a dose of hacking with an ample serving of chutzpah. But, thousands of businesses around the world have fallen for the scheme, in at least one case for as much as $90 million! For boards of directors, this is a scary trend and one that requires both tackling new challenges and getting back to basics. All companies, large and small, need to be on their guard against hacking. Cyber security is rapidly moving to being a core issue for all companies. Many of the most devastating hacking attacks take forms much like this 'CEO scam' in which there is a small amount of technology (in this case the fraudulently crafted email) and a large dose of what hackers call 'social engineering', i.e. traditional con artistry.
The best defense against this sort of scam is three fold: First, to ensure the board members and senior executives are up to date on the proper use of technology so that they can detect these sorts of scams. Even the most well crafted fraudulent email of this type will have some telltale, but subtle, signs that it is malicious. Second, company technologists need to be on the lookout for these sorts of fraudulent emails in order to screen out as many they can. Though no spam filter is perfect (and this sort of email is a kind of particularly nasty spam) they can certainly help.
Third, and most importantly, it is critical for boards to have the right controls in place in order to safeguard company assets. If, as CEO, you sent an email to a member of your team asking them to wire $90M to an offshore account, would they do it without checking with you? Who else in the organization would need to authorize a transaction like that, if anyone? As a board member, are you comfortable that the organization's controls for approving the disbursal of funds are good enough so that a scam like this would be caught? Are you confident that the executive team knows what the controls are, or at least where to find the documents that describe them?
In many ways, the more things change, the more they stay the same. It has always been critically important that boards implement the right controls to balance the need for organizational agility with the need to maintain good stewardship of the organization's assets. At iBoardrooms, we can help you do that. With a simple repository of key corporate documents (such as a payment authorization policy) that executives and board members can easily access to ensure that the payments they are making are legitimate and approved by the right people in the company, iBoardrooms makes it easy for organizations to be both agile and secure. Try us free for thirty days to find out more.
Mar 16, 2016 5:21 am EDT
Another article, this time from the Harvard Business Review, points out that only 6% of directors overseeing the world's biggest banks have any technology experience. In a world where technology is a core strategic issue for all companies, boards need to be able to deal with technology confidently and decisively.
Indeed, one of the most successful venture capital firms, Andreessen Horowitz, backers of Facebook, Twitter, and many others, says that "software is eating the world". Meaning that software is disrupting traditional business models and traditional businesses and the winners in industry after industry are the companies that embrace software to reinvent themselves. Not all industries are experiencing this change as rapidly, but even old line businesses like taxis have been famously disrupted by companies like Uber. Just because an industry is staid, doesn't mean it is protected. In fact, just the opposite is likely true. And this change is coming just as fast in the non-profit world as in the for profit world.
To deal with this reality, boards need to understand the technology landscape and be comfortable making strategic decisions in light of that landscape. CEOs and Executive Directors need to navigate these treacherous waters as well, and also instill confidence in their boards that they have a steady hand on the tiller. One way to shift the conversation for your board on technology is to move to an online board portal, instead of relying on paper board packets or emailed attachments. Moving your board's operations to the Cloud will help your board think about the Cloud in all aspects of your business. At iBoardrooms, we can help you do just that. Give us a try free for thirty days.
Indeed, one of the most successful venture capital firms, Andreessen Horowitz, backers of Facebook, Twitter, and many others, says that "software is eating the world". Meaning that software is disrupting traditional business models and traditional businesses and the winners in industry after industry are the companies that embrace software to reinvent themselves. Not all industries are experiencing this change as rapidly, but even old line businesses like taxis have been famously disrupted by companies like Uber. Just because an industry is staid, doesn't mean it is protected. In fact, just the opposite is likely true. And this change is coming just as fast in the non-profit world as in the for profit world.
To deal with this reality, boards need to understand the technology landscape and be comfortable making strategic decisions in light of that landscape. CEOs and Executive Directors need to navigate these treacherous waters as well, and also instill confidence in their boards that they have a steady hand on the tiller. One way to shift the conversation for your board on technology is to move to an online board portal, instead of relying on paper board packets or emailed attachments. Moving your board's operations to the Cloud will help your board think about the Cloud in all aspects of your business. At iBoardrooms, we can help you do just that. Give us a try free for thirty days.
Mar 14, 2016 3:37 am EDT
According to a post from Equilar, more than 10% of US public companies have four or more directors over the age of 70. As the baby boomers move into retirement, there will inevitably be a wave of turnover among directors and executives. Any transition can be difficult, but transitions among directors can be uniquely difficult because long serving directors are often the keepers of vast amounts of institutional knowledge. And, the knowledge that long time directors have is often about critical strategic thinking for the company.
It is said that the smart person learns from his mistake, and never makes it again. While the wise person learns from the mistakes of others and never makes them in the first place. When a new director comes in to replace a retiring director, it can be difficult, even with the best of intentions, for the new director to learn from others' past mistakes and past successes. There are several reasons for this, but one reason is that there often isn't a great set of board records that the new director can walk through in order to familiarize herself with the board's deliberations. When kept organized, the meeting minutes serve as a starting point, but the minutes of board meetings are, appropriately, a record of actions the board took and not a comprehensive history of the board's thinking.
This transition is a tricky one, but iBoardrooms can help. One of the features that we provide to help directors is a way to take notes on board agendas and documents. These notes are not part of the minutes or other official records of the board, but can help a director to organize their thoughts for a meeting. They can also be a great transition tool to help an incoming director get up to speed on the boards' thinking. Give iBoardrooms a try free for thirty days and let us help your board be great.
It is said that the smart person learns from his mistake, and never makes it again. While the wise person learns from the mistakes of others and never makes them in the first place. When a new director comes in to replace a retiring director, it can be difficult, even with the best of intentions, for the new director to learn from others' past mistakes and past successes. There are several reasons for this, but one reason is that there often isn't a great set of board records that the new director can walk through in order to familiarize herself with the board's deliberations. When kept organized, the meeting minutes serve as a starting point, but the minutes of board meetings are, appropriately, a record of actions the board took and not a comprehensive history of the board's thinking.
This transition is a tricky one, but iBoardrooms can help. One of the features that we provide to help directors is a way to take notes on board agendas and documents. These notes are not part of the minutes or other official records of the board, but can help a director to organize their thoughts for a meeting. They can also be a great transition tool to help an incoming director get up to speed on the boards' thinking. Give iBoardrooms a try free for thirty days and let us help your board be great.
Mar 11, 2016 6:10 am EST
As the US Presidential primary season continues, Hillary Clinton continues to be dogged by an investigation into which emails were sent to her private email server while she was Secretary of State. Potential issues include whether classified information was improperly sent outside of government systems and exposed to hackers or to those not authorized to receive the information.
This kind of situation happens everyday inside board of directors of companies and non-profits. Except that for boards it is typical, not unusual, for members to maintain their own email outside of the company. Directors , needless to say, receive highly confidential and legally privileged information all of the time in the normal course of their duties. Once these emails go to servers outside of the company, the can be exposed not only to hackers, but to employees of other firms who are in the normal course of business responsible for maintaining the email systems that directors are using.
Once these emails are exposed to outside parties in the normal course of business, you can't be sure that they will stay confidential and you can't be sure that they will remain legally privileged. In other words, a version of the controversy that has followed Hillary Clinton every step of the way though her 2016 campaign could find its way to your door.
At iBoardrooms our board portal software includes a secure messaging system that your board can use to easily communicate that keeps directors' communications secure and off of third party servers. Try iBoardrooms free for 30 days to see how easy it is, and keep your organization out of this sticky situation.
This kind of situation happens everyday inside board of directors of companies and non-profits. Except that for boards it is typical, not unusual, for members to maintain their own email outside of the company. Directors , needless to say, receive highly confidential and legally privileged information all of the time in the normal course of their duties. Once these emails go to servers outside of the company, the can be exposed not only to hackers, but to employees of other firms who are in the normal course of business responsible for maintaining the email systems that directors are using.
Once these emails are exposed to outside parties in the normal course of business, you can't be sure that they will stay confidential and you can't be sure that they will remain legally privileged. In other words, a version of the controversy that has followed Hillary Clinton every step of the way though her 2016 campaign could find its way to your door.
At iBoardrooms our board portal software includes a secure messaging system that your board can use to easily communicate that keeps directors' communications secure and off of third party servers. Try iBoardrooms free for 30 days to see how easy it is, and keep your organization out of this sticky situation.
Mar 10, 2016 6:15 am EST
The capitalization table or "cap" table, is one of the key documents for executives and board members at for profit companies. The cap table records which investors own what equity and debt in the company. Knowing who owns what is important for board members and executives to be able to make the right strategic decisions for the company and its investors.
Often, though, the cap table can get a bit lost in the shuffle. It isn't an accounting statement and so accountant and auditors aren't focused on it. Good CFOs have this document close at hand, but it can be difficult to ensure that other executives and board members have the latest version of the cap table if there are transactions happening in company securities. What can happen is that executives and directors are using different versions, some of which are out of date resulting in, at best, wasted time to get everyone on the same page and, at worst, strategic mistakes.
iBoardrooms has a solution for cap table confusion. iBoardrooms provides a simple way to keep track of the cap table. Executives and directors have one place where they can easily see the current cap table and can see previous cap tables in order to see how the capitalization of the company has changed over time. CFOs never need to worry about whether directors have the current version of the table and all interested parties can easily find the information they are looking for. The cap table can even be easily shared with third parties using iBoardrooms' virtual dataroom.
So stop playing hide and seek with your cap table, give iBoardrooms a try. It's free for thirty days.
Often, though, the cap table can get a bit lost in the shuffle. It isn't an accounting statement and so accountant and auditors aren't focused on it. Good CFOs have this document close at hand, but it can be difficult to ensure that other executives and board members have the latest version of the cap table if there are transactions happening in company securities. What can happen is that executives and directors are using different versions, some of which are out of date resulting in, at best, wasted time to get everyone on the same page and, at worst, strategic mistakes.
iBoardrooms has a solution for cap table confusion. iBoardrooms provides a simple way to keep track of the cap table. Executives and directors have one place where they can easily see the current cap table and can see previous cap tables in order to see how the capitalization of the company has changed over time. CFOs never need to worry about whether directors have the current version of the table and all interested parties can easily find the information they are looking for. The cap table can even be easily shared with third parties using iBoardrooms' virtual dataroom.
So stop playing hide and seek with your cap table, give iBoardrooms a try. It's free for thirty days.
Mar 10, 2016 6:14 am EST
As a review of Professor Adam Grant's new book Give and Take points out, managing risk is one of the most important capabilities innovators need to succeed. Though the stereotypical innovator or entrepreneur is a risk seeing riverboat gambler, the reality, at least for successful innovators and entrepreneurs, is that they are constantly seeking to manage, eliminate or mitigate risk.
In a way, this is simply common sense. One of the criteria of success for the successful innovator or entrepreneur is to have built an established business. Almost by definition, the established business is less risky than the idea that may one day serve as the foundation for an established business. So, to get from the idea to success, the innovator needs to intelligently manage risk in order to build value.
There is an important lesson here for boards of established companies and non-profits. One of the board's core functions is to monitor and manage risk. While at first blush this may seem to be an exercise in box checking or a mere compliance task, in reality it is core to turning innovation into value. Boards need to understand the nature of the innovations that their organizations are incubating, nurturing, relying upon and ultimately phasing out in order to intelligently reduce the risk around them at all of those stages of their lifecycle.
Gaining that deeper level of understanding takes time and commitment on the part of the board and the executive team, but it can unlock a tremendous amount of value for the organization. At iBoardrooms, we support boards and organizational leaders who want to make their companies or non-profits into engines of innovation. We do that by making board portal software that gets the administrative details out of everyone's way so that board members and executives have the time to spend on core strategic issues like managing innovation. Give us a try today.
In a way, this is simply common sense. One of the criteria of success for the successful innovator or entrepreneur is to have built an established business. Almost by definition, the established business is less risky than the idea that may one day serve as the foundation for an established business. So, to get from the idea to success, the innovator needs to intelligently manage risk in order to build value.
There is an important lesson here for boards of established companies and non-profits. One of the board's core functions is to monitor and manage risk. While at first blush this may seem to be an exercise in box checking or a mere compliance task, in reality it is core to turning innovation into value. Boards need to understand the nature of the innovations that their organizations are incubating, nurturing, relying upon and ultimately phasing out in order to intelligently reduce the risk around them at all of those stages of their lifecycle.
Gaining that deeper level of understanding takes time and commitment on the part of the board and the executive team, but it can unlock a tremendous amount of value for the organization. At iBoardrooms, we support boards and organizational leaders who want to make their companies or non-profits into engines of innovation. We do that by making board portal software that gets the administrative details out of everyone's way so that board members and executives have the time to spend on core strategic issues like managing innovation. Give us a try today.
Mar 8, 2016 4:39 am EST
One characteristic thing about board meeting agendas is that they contain a number of items that are repeated each meeting. One such item is the approval of the minutes of the previous meeting. Another might be a review of the financial statements of the organization. A third could be a review of operations. While the details do change for each of these items, in broad strokes they are the same each meeting.
And, it is a good thing that they are. A high performing board needs to review the finances of the organization it is charged to manage each meeting. A review of key operational metrics is, likewise, a very good idea. The iBoardrooms board portal makes it easy to create recurring agenda items so that you don't have to reinvent the wheel each time you want to discuss one of these. Simply attach the latest financial statements, operational metrics, or other key documents and you are ready to go.
Then both board members and CEOs/Executive Directors get the real benefit of a consistent presentation which is that it allows them to focus quickly on the key strategic issues rather that being distracted by changing presentation form or the work of reinventing the wheel for each board meeting.
And, it is a good thing that they are. A high performing board needs to review the finances of the organization it is charged to manage each meeting. A review of key operational metrics is, likewise, a very good idea. The iBoardrooms board portal makes it easy to create recurring agenda items so that you don't have to reinvent the wheel each time you want to discuss one of these. Simply attach the latest financial statements, operational metrics, or other key documents and you are ready to go.
Then both board members and CEOs/Executive Directors get the real benefit of a consistent presentation which is that it allows them to focus quickly on the key strategic issues rather that being distracted by changing presentation form or the work of reinventing the wheel for each board meeting.
Mar 7, 2016 4:27 am EST
How often have you been in a meeting or on a call where there was confusion about which version of a document is the latest one? "I sent it this morning", "It should be in your Inbox", "Let me resend". If those phrases or ones like them are familiar to you, then you are a version victim.
One of the key benefits of the iBoardrooms board portal is that every board member gets the same version of the board documents. And, if those documents change or need to be updated, all members get the updates seamlessly. It may seem like a small thing, but if your board meets once a quarter for three hours, and you spend five minutes every meeting figuring out who has what version of which document, you're spending almost 3% of your time with your board on needless administrative trivia.
Many businesses (and non-profits) would move heaven and earth to gain a 3% efficiency in their operations. And making your board meeting more efficient has positive effects that go beyond just spending your time more effectively. It also sets a professional tone that you want to have with your board members, and keeps them focused on strategy and high impact issues.
So don't be a Version Victim. Give iBoardrooms a try today.
One of the key benefits of the iBoardrooms board portal is that every board member gets the same version of the board documents. And, if those documents change or need to be updated, all members get the updates seamlessly. It may seem like a small thing, but if your board meets once a quarter for three hours, and you spend five minutes every meeting figuring out who has what version of which document, you're spending almost 3% of your time with your board on needless administrative trivia.
Many businesses (and non-profits) would move heaven and earth to gain a 3% efficiency in their operations. And making your board meeting more efficient has positive effects that go beyond just spending your time more effectively. It also sets a professional tone that you want to have with your board members, and keeps them focused on strategy and high impact issues.
So don't be a Version Victim. Give iBoardrooms a try today.
Mar 4, 2016 3:51 am EST
One of the themes that companies have started to grapple with is that employees increasingly bring their own devices (BYOD) to work and expect them to be able to use them to get work done. This means that companies have to be agile in order to support lots of different devices (iPhones, iPads, Android devices) connecting to their networks and resources.
While this is a relatively new phenomenon for company employees, board members have always used their own devices to manage communications with their boards, management and other directors. As board members become more and more technologically savvy, allowing them to use their devices to engage is a way to maximize the effectiveness of the entire board.
At iBoardrooms, we have build software for boards of directors to ensure that members can use their own devices, whether mobile, tablet or desktop, Mac, PC, iOS or Android to get the information they need, when they need it.
While this is a relatively new phenomenon for company employees, board members have always used their own devices to manage communications with their boards, management and other directors. As board members become more and more technologically savvy, allowing them to use their devices to engage is a way to maximize the effectiveness of the entire board.
At iBoardrooms, we have build software for boards of directors to ensure that members can use their own devices, whether mobile, tablet or desktop, Mac, PC, iOS or Android to get the information they need, when they need it.
Mar 3, 2016 3:45 am EST
As technology becomes a core strategic function in more and more industries, boards of directors are realizing that they need to have those skills in order to effectively oversee their organizations. Many boards are even establishing cyber security committees in order to manage cyber security risks. Clearly, boards that have cyber security committees are well served to have at least one member that is deeply knowledgable about technology.
As this post at The Wall Street Journal points out, it can be difficult to find board members who are both technologically savvy and have the strategic experience required to be an effective board member.
Finding the right board members is always a challenge, whether technology oriented or not. But there are some things you can do to make it easier, particularly if you are looking recruit or keep a technically savvy member. One of them is to commit the board to using more technology. If technology is core to your organization, it probably isn't a good idea to keep the board's operations out of the digital age. Here at iBoardrooms, we make board portal software that automates the administrative details of managing board meetings and other matters. One benefit is more efficient board meetings and more time to focus on strategy. Another important benefit is orienting the board to technology and keeping board members who expect modern technology in all aspects of their work happy.
As this post at The Wall Street Journal points out, it can be difficult to find board members who are both technologically savvy and have the strategic experience required to be an effective board member.
Finding the right board members is always a challenge, whether technology oriented or not. But there are some things you can do to make it easier, particularly if you are looking recruit or keep a technically savvy member. One of them is to commit the board to using more technology. If technology is core to your organization, it probably isn't a good idea to keep the board's operations out of the digital age. Here at iBoardrooms, we make board portal software that automates the administrative details of managing board meetings and other matters. One benefit is more efficient board meetings and more time to focus on strategy. Another important benefit is orienting the board to technology and keeping board members who expect modern technology in all aspects of their work happy.
Mar 2, 2016 4:25 am EST
Insidephilanthropy.com has a very interesting post about what to do when your donors take big losses in the stock market. Whether your organization is for-profit or non-profit, there is some great advice in this post, including:
We couldn't agree more with Kathy LeMay. Tough times are in many ways the best times to build strong relationships with your board and ensure that they understand the key strategic issues that you face. But, in tough times and good times the thing board members has precious little of is time. So use it wisely.
At iBoardrooms, we spend our time working on tools to help you manage your board effectively. Our tools automate the administrative details so you and your board can spend time on strategy and on building your organization. Whether you use our tools, other tools, or no tools at all, prioritizing strategy is so important if you want to ensure that your board is a key strength of your organization.
If you would like some help doing that, please give us a try.
- Don't spend dollars before they have arrived
- Leverage your existing support into more support
We couldn't agree more with Kathy LeMay. Tough times are in many ways the best times to build strong relationships with your board and ensure that they understand the key strategic issues that you face. But, in tough times and good times the thing board members has precious little of is time. So use it wisely.
At iBoardrooms, we spend our time working on tools to help you manage your board effectively. Our tools automate the administrative details so you and your board can spend time on strategy and on building your organization. Whether you use our tools, other tools, or no tools at all, prioritizing strategy is so important if you want to ensure that your board is a key strength of your organization.
If you would like some help doing that, please give us a try.
Mar 1, 2016 3:44 am EST
A great article from the New York Times on what Google found to be the key ingredients for making team productive in their business shows that the key factor for a productive team is establishing a space in which each of the members of the team feels comfortable taking risks.
This insight might seem banal, but how many times have you been in a meeting where one person dominates the airtime, or you didn't put forward a suggestion that you thought would be helpful because you thought the other members of the team might belittle your suggestion? We've all been there. And the output of the team is the worse off for it because not only are those foregone suggestions often very valuable, a team that feels that it can take risks is a team that can accomplish some really great things.
At first blush, it might seem counter-intuitive that a board would want to establish norms that encourage risk taking. After all, one of the key functions of a board of directors is to be a responsible steward of the company's assets on behalf of shareholders and others. But the risk taking that the article describes is not about putting the company at risk, but a board member taking the risk of voicing what might be an unpopular opinion.
For example, if a board member thinks that the upcoming audit should take a closer look at revenue recognition policies, or that a report to donors should come up with a more accurate metric to show effectiveness, it can be hard to be the first person to speak up about these things. If you have established norms for your board such that members feel comfortable voicing these opinions, regardless of whether they are adopted, you are much more likely to focus on the right issues and actually reduce company risk.
And, it can be even more challenging than it is for a typical group within a company to establish these kinds of productive norms given that your board meets only infrequently and there may be different goals among the different members. It is all the more important for the CEO or the Executive Director to put in an effort to establish the right norms for his or her board to follow. This takes time, but can result in much more productive meetings.
At iBoardrooms, we can't do the work of establishing these norms for you, but we can automate away a lot of the other tasks involved in keeping a board running smoothly. Whichever board portal you choose, be sure to leverage it in order focus on the key drivers of board success that only you can do, like setting the right risk taking norms for your board.
This insight might seem banal, but how many times have you been in a meeting where one person dominates the airtime, or you didn't put forward a suggestion that you thought would be helpful because you thought the other members of the team might belittle your suggestion? We've all been there. And the output of the team is the worse off for it because not only are those foregone suggestions often very valuable, a team that feels that it can take risks is a team that can accomplish some really great things.
At first blush, it might seem counter-intuitive that a board would want to establish norms that encourage risk taking. After all, one of the key functions of a board of directors is to be a responsible steward of the company's assets on behalf of shareholders and others. But the risk taking that the article describes is not about putting the company at risk, but a board member taking the risk of voicing what might be an unpopular opinion.
For example, if a board member thinks that the upcoming audit should take a closer look at revenue recognition policies, or that a report to donors should come up with a more accurate metric to show effectiveness, it can be hard to be the first person to speak up about these things. If you have established norms for your board such that members feel comfortable voicing these opinions, regardless of whether they are adopted, you are much more likely to focus on the right issues and actually reduce company risk.
And, it can be even more challenging than it is for a typical group within a company to establish these kinds of productive norms given that your board meets only infrequently and there may be different goals among the different members. It is all the more important for the CEO or the Executive Director to put in an effort to establish the right norms for his or her board to follow. This takes time, but can result in much more productive meetings.
At iBoardrooms, we can't do the work of establishing these norms for you, but we can automate away a lot of the other tasks involved in keeping a board running smoothly. Whichever board portal you choose, be sure to leverage it in order focus on the key drivers of board success that only you can do, like setting the right risk taking norms for your board.
Feb 26, 2016 10:56 pm EST
Normally, a board of directors takes official actions during a board meeting. One of the board members will propose a motion, another will second it, and if the board votes to approve the motion then that motion is an official action of the organization that the board has responsibility for overseeing.
The reason for making motions and passing them by vote is that the board as a group has the legal responsibility for overseeing and managing the organization. The board members individually, unless they have been specifically empowered by a previous board vote (for example one of them may have been appointed CEO), do not have authority on their own to make decisions on behalf of the organization.
But sometimes the board needs to make a decision and there either is not time to convene a board meeting, or else it is not convenient. So, outside of a board meeting, how does a board make a decision to help their organization? Typically, the answer is that the board uses a consent document. Many, if not most, corporate by laws allow the board to take official actions using a consent document. And typically the board needs to agree unanimously for the consent to take effect. These unanimous consent documents spell out the specific action to be taken and have a signature page where each of the board members can sign.
This is a great tool for boards to have and to make use of, but there are some challenges that come along with them. First, you want to be able to easily verify that you have gotten all of the required signatures back. This is conceptually straightforward, but there are certainly occasions where a signature gets misplaced and needs to be replaced, sometimes on very short notice!
Also, if your board members have to mail their signatures back, it can take longer to get a consent document done than it does to convent a board meeting in which all of the members attend by phone. It helps a great deal to have an easy way for your board members to get their signatures back to you electronically. And, you also want to keep all of these documents organized and easily accessible for your board to review at a later date, electronically if you can. If you plan to bring on additional investment, these consent documents will also likely be something that your investor will want to take a look at in their due diligence process.
If all this seems straightforward, then you're well on your way taking best advantage of consents and how they can help your board and organization work best. If it seems a little daunting, then there are good tools out there to make it easy. We make one of these tools here at iBoardrooms, and we hope you will consider giving it a try.
Feb 23, 2016 4:07 pm EST
"We've got another one Eddie."
Eddie let out a long sigh, leaned back in his chair, and stretched. He tried to remember why he decided to take this job in the first place. Something about the opportunity to work closely with C-level executives and board members, broaden his horizon beyond the nitty gritty details of computer security. Eddie had always been comfortable with technology. Truth be told, if he filled out his Match.com profile the way he really should have, his likes would have included pina coladas, getting caught in the rain, and finding buffer overflow bugs in low level system software.
But, sometime during the week after his 47th birthday he decided to take his boss up on the idea that he would be suited for a management role helping his firm deal with their increasing cybersecurity problem from an organizational, management and policy perspective, as much as from a technical one. For one thing, Eddie knew from his years of experience that getting security right is a process that involves all of those perspectives and more. And as the locals down at Finn McCool's (the nearest establishment serving a full Irish breakfast all day) would tell you, Eddie's team "Show Me The Monet" took first place every week in pub trivia night. In other words, Eddie liked to get things right.
And in order to get things right in security Eddie had to move into management. That was ten years ago. Three promotions and two targeted headhunting processes later Eddie found himself sitting in his chair, mid stretch, as chief information security officer, a role he'd been able to settle into over the past 18 months.
"Well, tell me what we've got," Eddie said to Brenda, the systems administrator who worked closely with him to secure the senior executives' computers and other devices.
"It's a kind of ransomware, but not one I have ever seen before," said Brenda.
Eddie knew all about ransomware. He had actually attended a conference with the attorney who had represented the man who wrote the very first piece of documented ransomware back in the late 1980's. The pattern was always the same, an unsuspecting user clicks on a link in an email, or perhaps an attachment or suffers one of the innumerable other ways that malicious software can get on to a computer. Once it has infected the computer, the malware stealthily encrypts all of the data on board and, once it has finished, holds that data for ransom by making the user pay to get the key to unlock their data. The author of the original ransomware required you to send cash to a P.O. Box in Panama, the latest versions demand payment in Bitcoin. "Progress, of a sort," Eddie mused to himself.
"Well, we've certainly seen ransomware before and we know how to deal with it," Eddie said. "Just wipe the affected computer's hard drive and we will restore it's data from the backup we took last night."
Eddie was looking forward to the long weekend, he had on a whim this morning bought plane tickets to New Orleans and could already feel his feet tapping to the blues on Frenchman Street.
"I don't think we want to do that in this case Eddie," replied Brenda.
"What do you mean?" Eddie said. "There's nothing on our company computers that can't be wiped. All our email lives on our servers and all documents are on our private cloud. Hell, even if for some reason we can't wipe this machine, just go grab another one and we'll just install a fresh set of software on it for... um, whose computer did you say this was anyway?"
"I didn't, but it is Steve McDouglas's laptop," Brenda said.
"Steve McDouglas? The chairman of the board?" Eddie spluttered. "But wait, we don't even issue computers to board members. They all use their own systems. They aren't technically even employees."
"That's right, and that's why we can't just wipe and restore Mr. McDouglas' laptop. It's not one of ours," Brenda said.
"Yeah, and who knows what else he has on there. Isn't he on two other boards in addition to ours?" Eddie mused. "Ok, it pains me to say this, but we'll have to just pay these guys off to unlock the thing. Given the potential disruption to Mr. McDouglas and to us, the cost is trivial. What are they asking for, $500?"
"Well, that's the thing" Brenda said, hesitatingly. "They're not asking us to pay them off so that we can unlock the laptop."
"What? But, that's the way these things always work" Eddie said. "Their whole business model is to get paid to provide the key back, so what do they want?"
"It's the strangest thing, they're asking us to pay them to destroy the key" said Brenda.
"Huh?" Eddie asked. "That doesn't make any sense. If they destroy the key, there won't be any way to recover the data."
"That's right Eddie," Brenda agreed. "But the thing is, they've taken the data they got from Mr. McDouglas' laptop and posted it, encrypted, to the dark web, and they're going to post the key as well if we don't pay them."
Eddie turned white. "What?" he gasped. "What, ah, what data did they get?"
"Well, we're going to have to ask Mr. McDouglas that to really know," Brenda said. "But they did send a list of filenames, and there's some stuff here that I don't think we want out there."
"Like what?" Eddie asked.
"Like 'M&A targets', 'results of internal investigation', 'CEO performance evaluation', an email thread titled 'audit difficulties', and those are just the first four on the list," Brenda replied.
"Oh my God," Eddie moaned. "How much are they asking for to destroy the key?"
Brenda cleared her throat. "$5 million."
The story above is a work of fiction, any resemblance to persons or firms living or dead is purely coincidental. But, if you want to ensure that a story like this doesn't happen to your organization, be sure that you have the right tools in place to secure your board's files and communications. As the story relates, your board members have access to some of the most sensitive information your firm has, and if they use their regular email to receive it, often have it outside of the systems you have put into place to protect that data.
Eddie let out a long sigh, leaned back in his chair, and stretched. He tried to remember why he decided to take this job in the first place. Something about the opportunity to work closely with C-level executives and board members, broaden his horizon beyond the nitty gritty details of computer security. Eddie had always been comfortable with technology. Truth be told, if he filled out his Match.com profile the way he really should have, his likes would have included pina coladas, getting caught in the rain, and finding buffer overflow bugs in low level system software.
But, sometime during the week after his 47th birthday he decided to take his boss up on the idea that he would be suited for a management role helping his firm deal with their increasing cybersecurity problem from an organizational, management and policy perspective, as much as from a technical one. For one thing, Eddie knew from his years of experience that getting security right is a process that involves all of those perspectives and more. And as the locals down at Finn McCool's (the nearest establishment serving a full Irish breakfast all day) would tell you, Eddie's team "Show Me The Monet" took first place every week in pub trivia night. In other words, Eddie liked to get things right.
And in order to get things right in security Eddie had to move into management. That was ten years ago. Three promotions and two targeted headhunting processes later Eddie found himself sitting in his chair, mid stretch, as chief information security officer, a role he'd been able to settle into over the past 18 months.
"Well, tell me what we've got," Eddie said to Brenda, the systems administrator who worked closely with him to secure the senior executives' computers and other devices.
"It's a kind of ransomware, but not one I have ever seen before," said Brenda.
Eddie knew all about ransomware. He had actually attended a conference with the attorney who had represented the man who wrote the very first piece of documented ransomware back in the late 1980's. The pattern was always the same, an unsuspecting user clicks on a link in an email, or perhaps an attachment or suffers one of the innumerable other ways that malicious software can get on to a computer. Once it has infected the computer, the malware stealthily encrypts all of the data on board and, once it has finished, holds that data for ransom by making the user pay to get the key to unlock their data. The author of the original ransomware required you to send cash to a P.O. Box in Panama, the latest versions demand payment in Bitcoin. "Progress, of a sort," Eddie mused to himself.
"Well, we've certainly seen ransomware before and we know how to deal with it," Eddie said. "Just wipe the affected computer's hard drive and we will restore it's data from the backup we took last night."
Eddie was looking forward to the long weekend, he had on a whim this morning bought plane tickets to New Orleans and could already feel his feet tapping to the blues on Frenchman Street.
"I don't think we want to do that in this case Eddie," replied Brenda.
"What do you mean?" Eddie said. "There's nothing on our company computers that can't be wiped. All our email lives on our servers and all documents are on our private cloud. Hell, even if for some reason we can't wipe this machine, just go grab another one and we'll just install a fresh set of software on it for... um, whose computer did you say this was anyway?"
"I didn't, but it is Steve McDouglas's laptop," Brenda said.
"Steve McDouglas? The chairman of the board?" Eddie spluttered. "But wait, we don't even issue computers to board members. They all use their own systems. They aren't technically even employees."
"That's right, and that's why we can't just wipe and restore Mr. McDouglas' laptop. It's not one of ours," Brenda said.
"Yeah, and who knows what else he has on there. Isn't he on two other boards in addition to ours?" Eddie mused. "Ok, it pains me to say this, but we'll have to just pay these guys off to unlock the thing. Given the potential disruption to Mr. McDouglas and to us, the cost is trivial. What are they asking for, $500?"
"Well, that's the thing" Brenda said, hesitatingly. "They're not asking us to pay them off so that we can unlock the laptop."
"What? But, that's the way these things always work" Eddie said. "Their whole business model is to get paid to provide the key back, so what do they want?"
"It's the strangest thing, they're asking us to pay them to destroy the key" said Brenda.
"Huh?" Eddie asked. "That doesn't make any sense. If they destroy the key, there won't be any way to recover the data."
"That's right Eddie," Brenda agreed. "But the thing is, they've taken the data they got from Mr. McDouglas' laptop and posted it, encrypted, to the dark web, and they're going to post the key as well if we don't pay them."
Eddie turned white. "What?" he gasped. "What, ah, what data did they get?"
"Well, we're going to have to ask Mr. McDouglas that to really know," Brenda said. "But they did send a list of filenames, and there's some stuff here that I don't think we want out there."
"Like what?" Eddie asked.
"Like 'M&A targets', 'results of internal investigation', 'CEO performance evaluation', an email thread titled 'audit difficulties', and those are just the first four on the list," Brenda replied.
"Oh my God," Eddie moaned. "How much are they asking for to destroy the key?"
Brenda cleared her throat. "$5 million."
The story above is a work of fiction, any resemblance to persons or firms living or dead is purely coincidental. But, if you want to ensure that a story like this doesn't happen to your organization, be sure that you have the right tools in place to secure your board's files and communications. As the story relates, your board members have access to some of the most sensitive information your firm has, and if they use their regular email to receive it, often have it outside of the systems you have put into place to protect that data.
Feb 22, 2016 8:25 am EST
At their best, Boards of Directors sharpen, challenge and enhance a company's best strategic thinking. But according to a recent McKinsey study the best boards invest a significantly greater amount of time in their work than do lower performing boards. Members of the highest impact boards spend 21 days a year more working on their board's behalf than do the members of moderate or low impact boards, spending 8 more days a year on strategy alone. For people as busy as board members tend to be, that is an enormous difference.
If you are the leader of an organization and you want to ensure that your board helps you build the best organization possible, you need to think carefully about the implications of this study.
Board members were asked in this survey how many days they would ideally spend on their duties. It comes as no surprise that the members of moderate and low impact boards thought that they should increase the number of days they spent per year and increase it from 19 to 27. Interestingly, the members of high impact boards also thought that it would be best to increase the number of days they spend working as board members, suggesting adding five days to put their ideal total at 45 days per year.
Even members of high performing boards feel that they can increase their contribution to their organization if they spend a bit more time doing it, which is an extremely valuable insight for a leader of an organization to have. As a leader, there is always a worry that you are taking more time from your board than they really have to give since the vest majority of board members are incredibly busy people. But, given the chance to be productive and helpful, board members will give an enormous amount of time to help you.
Notice, also, that the best boards spend the same amount of time on the core governance and compliance functions as do the moderate and low impact boards, each of them spending 4 days per year on the subject. In all other areas, the high impact boards are spending more time than the moderate to low impact boards. As you think about managing your board, it is important to think about how you can maximize the time that your board spends on high impact topics, like strategy, performance management and M&A. One way to do that is to make the time spent on governance and compliance as efficient as possible.
And, speaking of efficiency, let's not forget the large amount of prep work required to make 40 or 45 days of board work productive for your members. If we use the rule of thumb that teachers and professors have been using for years, that it takes 2 - 4 hours of prep time to make best use of an hour of classroom time, then you are looking at spending between three and six man-months each year prepping for your board interactions, on top of the 45 days you will be ideally spending actually interacting with your members. Before you know it, you are spending more than half the year with your board, leaving precious little time to actually run your organization and execute the initiatives you've been talking with your board about.
But, if being a leader were easy, anyone would do it. There are ways, however, to make managing your board easier. These range from board portals (like we provide here at iBoardrooms) to dedicated staff to work with your board, to simple things like ensuring that you don't reinvent the wheel every time you create a board presentation (reuse those PowerPoint templates, that's what they're for!). But whichever set of tools you choose, be sure to select the right ones for your organization.
The value that you can unlock by making your board a high performing contributor to your organization is enormous and it starts by streamlining the time your board spends on what you have to do so that you can spend time on the things that really move the needle. You'll be surprised how willing your board members are to contribute meaningfully if you ask them to pitch in on matters that are strategically important.
If you are the leader of an organization and you want to ensure that your board helps you build the best organization possible, you need to think carefully about the implications of this study.
Board members were asked in this survey how many days they would ideally spend on their duties. It comes as no surprise that the members of moderate and low impact boards thought that they should increase the number of days they spent per year and increase it from 19 to 27. Interestingly, the members of high impact boards also thought that it would be best to increase the number of days they spend working as board members, suggesting adding five days to put their ideal total at 45 days per year.
Even members of high performing boards feel that they can increase their contribution to their organization if they spend a bit more time doing it, which is an extremely valuable insight for a leader of an organization to have. As a leader, there is always a worry that you are taking more time from your board than they really have to give since the vest majority of board members are incredibly busy people. But, given the chance to be productive and helpful, board members will give an enormous amount of time to help you.
Notice, also, that the best boards spend the same amount of time on the core governance and compliance functions as do the moderate and low impact boards, each of them spending 4 days per year on the subject. In all other areas, the high impact boards are spending more time than the moderate to low impact boards. As you think about managing your board, it is important to think about how you can maximize the time that your board spends on high impact topics, like strategy, performance management and M&A. One way to do that is to make the time spent on governance and compliance as efficient as possible.
And, speaking of efficiency, let's not forget the large amount of prep work required to make 40 or 45 days of board work productive for your members. If we use the rule of thumb that teachers and professors have been using for years, that it takes 2 - 4 hours of prep time to make best use of an hour of classroom time, then you are looking at spending between three and six man-months each year prepping for your board interactions, on top of the 45 days you will be ideally spending actually interacting with your members. Before you know it, you are spending more than half the year with your board, leaving precious little time to actually run your organization and execute the initiatives you've been talking with your board about.
But, if being a leader were easy, anyone would do it. There are ways, however, to make managing your board easier. These range from board portals (like we provide here at iBoardrooms) to dedicated staff to work with your board, to simple things like ensuring that you don't reinvent the wheel every time you create a board presentation (reuse those PowerPoint templates, that's what they're for!). But whichever set of tools you choose, be sure to select the right ones for your organization.
The value that you can unlock by making your board a high performing contributor to your organization is enormous and it starts by streamlining the time your board spends on what you have to do so that you can spend time on the things that really move the needle. You'll be surprised how willing your board members are to contribute meaningfully if you ask them to pitch in on matters that are strategically important.
Feb 21, 2016 8:25 am EST