Meetings of board directors, 67% of which do not produce any results, are giving way to modern planning tools. Even where meetings cannot be completely eliminated, meetings are limited in time and composition.
The Importance of Board Directors Meetings
The structures and processes that govern the board directors’ meetings are usually associated with various performance management, control, and accounting mechanisms. It is very important to have high board directors meeting attendance because:
- The principles of management do not change. Only the means change. You still have to find the right people to get the job done and find a way for them to get it done.
- Whoever you do business with, be honest and fair. Many areas of business do not offer very broad opportunities. You may be surprised at how often you have to work with the same people. Better that they respect you than dragging the burden of their displeasure with you.
- The current activity usually leaves no time for you to think. You must take the time to smell the roses. In your work, you must have time to understand the consequences of your actions.
Besides, the most important trend in the board directors’ meeting attendance in recent decades has become a systematic approach, which is considered as a modern way of management thinking, which allows one to present holistically and comprehensively the management of an organization and its subsystems in a complex market environment. The use of a systematic approach makes it possible to reveal the internal structure.
Always Attend Board Directors Meetings
It is very important to have a high meeting attendance of board directors, because:
- The participants in these relationships may have different (sometimes opposing) interests. Discrepancies may arise between the interests of the company’s management bodies, i.e., the general meeting of shareholders, the Council, and executive bodies.
- The interests of owners and managers do not coincide either. Conflicts also arise within each governing body, for example, among shareholders (between large and minority shareholders, controlling and non-controlling shareholders, individuals, and institutional investors) and among directors (between the executive and non-executive directors, external directors and directors from among shareholders or employees of the company, independent and dependent directors), and all these different interests must be considered and balanced.
- The general meeting, representing the shareholders, makes major decisions (for example, on the distribution of the company’s profits and losses), while the Council is responsible for the overall management of the company and overseeing the managers. Finally, managers manage the day-to-day operations of the company by implementing strategy, preparing business plans, managing employees, developing marketing and sales strategies, and managing company assets.
- All this is done in order to properly distribute rights and responsibilities and, thus, increase the value of the company for shareholders in the long term. For example, mechanisms are created by which minority shareholders can prevent the controlling shareholder from benefiting by entering into interested-party transactions or using other inappropriate methods.
- Attendance aspects of corporate governance related to the relationship between the company and its stakeholders. Stakeholders are individuals or organizations that have specific interests associated with the enterprise. Such interests may arise by virtue of law, on the basis of a contract, as a result of public relations, or in connection with geographic location. Stakeholders include primarily investors, but also workers, lenders, suppliers, consumers, regulators, government agencies, and local residents in the area where the business is located and operates.