What does a bad board meeting look like?

by Jo Ellis on May 27, 2022

a bad board meeting

Members receive exclusive insights and opportunities

The Corporate Governance Institute provides it's members with exclusive content, a network of directors and business leaders, details of available board positions, and the tools and resources required for a successful governance career.

Learn More

Already a member? Log in here

Good corporate governance is the backbone of any thriving company. Strong leadership, comprehensive boundaries, and ethical operations can help lead a company to success. However, if you feel you are sitting in a bad board meeting, it may be time to speak up.

Many resources can teach you how to use good corporate governance strategies during board meetings, but how do you identify the signs of poor corporate governance? How do you know you are sitting in a bad board meeting? 

Poor corporate governance

Corporate governance impacts every single aspect of a company’s infrastructure. A company with poor corporate governance will often experience challenges, miscommunications, and low compliance levels. This can lead to a lack of accountability, inadequate employee retention, and loss of profits.

Director training is essential as it can help directors lead their company to success.

Here are five examples of poor corporate governance and five signs you could be sitting in a bad board meeting.

Refusing feedback

If a board member, particularly the CEO, takes a “my-way-or-no-way” approach to corporate governance, it never ends well. 

Effective leadership ensures all aspects of operations are running smoothly, but this cannot happen if team members are dissatisfied with board procedures. 

Good chairs and CEOs look for feedback. They take all comments seriously, as board members may provide compelling insight into situations that have been overlooked in the past. 

A critique is simply a form of communication that allows leaders to reassess their strengths and weaknesses. Refusing critique is a sign of stubborn management and can lead to discord between the board of directors and management if issues are left unresolved. 

Focusing on compliance above all else

Although compliance with company policies is critical for any well-functioning business, it is not the be-all-and-end-all solution. 

Focusing on compliance above everything else can damage the interrelations between board members and management. 

While all people must respect legislation, codes of practice, and regulations within the company, good corporate governance practices come from ensuring all board members have their needs met by the management team. 

Failing to monitor performance

Performance is one of the most accurate indicators of the effectiveness of company policies and regulations. 

Monitoring performance is one of the most critical ways that corporate governance can plan for the future. It is crucial to identify performance issues before they cause more significant issues within the company. Doing so can help eliminate negligence, lack of accountability, and poor work practices.

Monitoring the board of directors’ performance can help navigate company expectations while guiding the brand towards success. If a board’s organisational performance is not up to par, it’s up to the executives and others responsible for corporate governance to step up and figure out what’s wrong. 

Avoiding risk management

Risk management is crucial for any well-functioning company. Corporate governance cannot work efficiently if risk management is avoided. Not only does risk management prevent losses, but it can also promote a company’s growth. Company directors need to perform risk assessments to understand what business practices are best to use in future operations. 

Avoiding risk management can also increase liability risks, create toxic work environments, and lead to a lack of accountability. In severe cases, poor risk management can be catastrophic for a company, causing lawsuits, loss of profits, and even bankruptcy. 

Management of risks is a responsibility that typically falls under the board of directors’ duties, so it’s up to the executives to ensure these duties are accomplished. Putting a well-established system of risk management in place can also help to improve decision-making processes.

Lack of comprehensible boundaries

A company with a lack of comprehensible boundaries will struggle to perform day-to-day operations and get through board meetings efficiently. Effective leadership and corporate governance mean ensuring that all operations are functioning with clear guidelines in place for team members. 

To lead a company to success, executives must come up with a series of regulations that are understandable to all and feasible to integrate into daily business operations. Without clear company policies, a board of directors can’t do its job correctly. Spelling out comprehensible boundaries and company expectations in no uncertain terms makes operations run smoothly and effectively. 

Final thoughts on a bad board meeting

By avoiding these poor corporate governance practices, a company can ensure that it’s functioning to its maximum potential. An effective board of directors should be able to govern without making any of these fundamental errors. Failing to incorporate good corporate governance practices into a business strategy can be problematic and possibly devastating to a company’s well-being.

Learn how to be an effective board member. Know how board meetings should run and what areas boards must focus on to help their organisations thrive.

Discover the Diploma in Corporate Governance
board meetings
Poor governance
Toxic boards

Related Posts