Best practice in preparing board materials

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DentonsBoard meeting preparation (and in particular the preparation of associated materials) is critical to ensure that all directors present at the meeting are prepared and informed so as to make the best decisions possible for the company. Unfortunately, there is no cookie-cutter approach to preparing board meeting materials. However, there are a number of guidelines that if followed, may assist in ensuring that the materials are prepared and delivered properly. 

1. When to circulate board materials and how they should be circulated

Board materials should be prepared and circulated in advance of all board meetings. The best practice is to circulate board materials between five and seven business days prior to the meeting. Early circulation ensures that board members have adequate time to review the materials and prepare in advance of the meeting.

Board materials contain confidential and sensitive information. As such, there are a number of factors to consider when distributing them. Distributing by email or delivering hard copies poses risks of data loss, misdelivery, and disorganization. The best practice in distributing board materials is to use password-protected board portals, SharePoint sites or other secure document sharing platforms. This ensures that materials remain in a secure, organized location, which is easily accessible by all board members.

2. Who prepares the agenda and best practices in its creation

Typically the corporate secretary or in-house legal counsel prepares the agenda for each board meeting. The corporate secretary/legal counsel should take notes during the previous board of director’s meeting and begin a first draft of the agenda immediately at its conclusion. The corporate secretary/legal counsel should then revisit and revise this draft one month out from the upcoming board meeting. Once the revised draft is established, the corporate secretary/legal counsel should seek input from management of the company, along with any board or committee chairs. This consultation typically occurs two weeks in advance of the next meeting. Once their input is incorporated, the finalized agenda should be circulated to all board members in advance of the meeting along with the board materials. When distributing a notice of meeting or any board materials, the corporate secretary/legal counsel should remain mindful of any meeting notice requirements which may be required pursuant to the company’s constating or governance documents.

3. Common agenda items

Agendas may vary based on the unique context of the meeting; however, they typically follow a prescribed structure. The first item on the agenda should be roll call. The roll call allows the chair and secretary of the meeting to record who is in attendance and ensure that a quorum has been achieved. The standard agenda items may include:

  • Call to order
  • Confirmation of quorum
  • Reading and approval of minutes from the previous meeting (or, if the minutes were distributed before the meeting, confirmation that no changes are required)
  • An update from management regarding events since the previous meeting
  • Committee and ad hoc committee reports
  • Updates on various departments and programs
  • Financial reports
  • New business
  • Scheduling of the upcoming meetings
  • Adjournment

Apart from the prescribed items above, agendas also frequently include time for strategic discussions and administrative matters. This provides the board with the flexibility to address whatever current obstacles the company is facing. During strategic discussions, the board will discuss any current operational challenges or opportunities. This may include recent transactions, project development, employment matters, etc. Likewise, during the administrative matters discussion, the board may discuss the various administrative undertakings of the company.

After the various strategic and administrative discussions are concluded, the final agenda item should be an adjournment. The adjournment signals the end of the meeting. Boards will often pause here for any final questions or comments. Subject to any final discussions, the chair will declare the meeting adjourned.

4. Destruction of board materials after the meeting

Board materials contain sensitive information that must remain confidential. It is considered best practice to destroy board materials after the meeting to ensure that this sensitive information is not released and the meeting minutes provide the one official record of the meeting’s content. However, recent studies show that only about one third of corporations have document destruction policies. Implementing a document destruction policy can greatly improve the security of boards’ confidential information. An effective document destruction policy will not only require the destruction of all board materials, but any notes taken by members during the meeting as well.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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