Virtual meetings have become the norm across various levels of organisations. Following the COVID-19 pandemic and its lockdowns, businesses had to strive to achieve some level of balance and continue with business as usual within the confines of what they could do in the circumstances.
The Boardroom was not spared as it had to lead from the front and strategically assist businesses to continue running effectively for the benefit of the shareholder. The Board itself had to demonstrate effectiveness inspite of the circumstances. This meant that business as usual could still be undertaken in the unusual environment.
But is the virtual boardroom here to stay? Whilst we ponder on the question, it is worth ensuring that the next virtual meeting is properly planned, communication is done effectively, and the Board collaborates well. The Companies Act 2003 Fourth Schedule recognises a virtual board meeting as an appropriate method of holding meetings. It recognises audio or audio and visual communication by which all directors participating and forming a quorum can simultaneously hear each other throughout the meeting.
Here are Seven Best Practices to adopt to foster an effective virtual board whilst maintaining and promoting effective good corporate governance:
Structure of the Meeting and Contents of the Board Pack
Agreeing on the flow of the meetings, that is the agenda and the contents of the pack, with the Chairperson of the Board prior to the meeting creates a certain level of comfort for the Chairperson as they get to understand Management’s thought process behind the Board Pack and are able to make any changes they deem necessary to the order of the day. Management is also then prepared to implement any changes, instead of finding out on the spot.
Confirmation of Attendance
Attendance can be tricky during a virtual board meeting. Unlike a physical meeting, you will only know a board member is not present at the time the meeting is just minutes away from its scheduled time. It is important to confirm availability prior to scheduling a meeting a few days before the meeting and as the starting time draws near on the day of the meeting. This may seem like overkill but it has proven effective in that you are able to manage the quorum timely and prepare for any changes that may need to be effected.
By regularly checking with your Board, they become accustomed to this method of communication and they too will fall into the habit and regularly check with you to confirm if “the meeting is still on” and “would I affect quorum if I am not in attendance?” There is a collaborative approach to ensuring the Board meeting takes place by both the Board Members and the Company Secretary.
Accessibility – Technology & the Board Pack
It is important to ensure that the Board has the right technology to securely access the Board Pack and the meeting. Ensuring that the devices that the Board uses to access the various platforms availed to the Board while maintaining the required security is pertinent. Good quality Internet, a digital platform for accessing information prior to and during the meeting that allows for annotation by members and a suitable device must be provided for or available to members.
Real-Time Access to Resources
A virtual meeting supported by physical documents does not fully realise the effectiveness and the benefits of a virtual board, especially if an attendee is mobile or in transit. If the pack is lost, they will not be able to fully participate in the meeting and sensitive information could land in the wrong hands. Further, ensuring that the “portal” being used is fully resourced with key resources that members can access as a reference point at all times saves time and contributes to many organisations’ goals to remain paperless and contribute to safeguarding our planet. This is small, yet pertinent activity towards sustainability.
Flexibility with a Pinch of Consistency
Sometimes normal needs to be tweaked a little to allow the Virtual Board to be effective. This includes switching up the agenda on the spot to allow pressing matters to be attended to, allowing discussion on items that were not on the agenda but required the Board’s attention on the spot. How this is communicated to the Board and your previous track record of consistency will influence the Board’s willingness to accept a curveball.
Although the commute to a meeting is completely erased by connecting remotely and/or virtually, it remains as important to manage the time of the meeting. Time Management ensures the meeting is more focused, more efficient, and more action oriented. Members become more flexible when requesting to schedule meetings as they are assured that the meetings will not take too long and will be focused. Although there may be instances where some matters require a more prolonged engagement, these are often ideal for a special meeting outside of the ordinary board meeting to be certain that all matters are given the attention they deserve.
Managing the Unexpected
A lot can go wrong during a virtual board meeting. When a confirmed attendee is absent and needs to be reached, it is important that you have others assisting you to try to reach the attendee whilst you manage the awkward silences that come from a meeting being virtual. Sometimes attendees get cut off during the meeting – keep an eye on the attendee list to ensure the quorum remains intact and reach out to the attendees who have been lost.
The unexpected may also include power outages, loud storms, technical difficulties and these need to be managed well. Adjusting to the unexpected and facilitating transition to a hybrid (where possible), and even suspending/postponing the meeting are not taboo.
Validity of Virtual Decisions
One key aspect of the virtual board meeting is to ensure that actual decisions are made during the meeting. It is common to have deliberations continue with no firm decision made at the end. The Company Secretary should keep track of the proceedings and ensure that the members make a firm/unequivocal decision in the meeting.
This ensures that when preparing a record of the proceedings (minutes), one captures the approvals and/or decisions made during the meeting. The decisions made during a virtual board meeting remain as valid as those made during a physical board meeting because a virtual means is an appropriate method of holding a board meeting.