Technology Makes Boards More Confident

Using board meeting software consistently makes participants more effective, more collaborative, and more confident in the security of board communications. 

Engagement Drives Effectiveness

Board member engagement is the primary driver of board effectiveness. The ability to focus on strategic imperatives also defines board effectiveness.

Innovation & Diversity Are Top of Mind

There’s a clear appetite and need to use technology to improve board effectiveness, including challenges around innovation and the need to attract diverse directors.  

Webinar Recap: OnBoard surveyed more than 400 board leaders worldwide on how their boards performed in 2021. Here’s what they said.
Design Lines

As boards continued to navigate the COVID-19 pandemic and the ongoing digital evolution throughout 2021, two things became abundantly clear:

  1. Board management software will play an increasing role on boards of directors worldwide, even after the pandemic (hopefully) subsides.
  2. Remote and hybrid meetings are here to stay.

Over 400 board leaders told us. They also shared plenty of other information about how their boards thrived in 2021, where they struggled, and where they’re going in 2022 and beyond.

OnBoard’s second Board Effectiveness Survey, which was available to board directors for a two-month period starting in December 2021, revealed plenty about the direction of boards worldwide. Let’s take a look.

Watch the “How Technology Impacts Boards” webinar now.

Who Answered the Survey?

Members of nonprofit boards made up the largest plurality of respondents, with 130, or 31%. Higher education board members were a distant second at 56 (13%), followed by health care (46, 11%), bank (36, 9%), technology (34, 8%), credit unions (25, 6%), and associations (15, 4%).

Board roles were fairly evenly represented, including:

  • Chief executive/chair (107, 26%)
    Executive management (93, 22%)
    Board administrator (87, 21%)
    Board director (81, 19%)
Survey Result Takeaways

Board Effectiveness Survey results provided OnBoard with 3 primary takeaways to share. We’ll cover the third takeaway in another blog. For now, let’s focus on the first two conclusions:

1. Using board meeting software consistently makes participants more effective, more collaborative, and more confident in the security of board communications.

Here’s the data that led OnBoard to this conclusion:

  • 69% of respondents said their board has been more effective in the last 12 months
  • 63% said their board is more collaborative in the last 12 months
  • 85% are confident in board communications security today

Maybe more telling, 74% of respondents who use board management software say their board was more effective in the last 12 months. Meanwhile, 63% of boards who don’t use board meeting software say their board was more effective during the same time period.

Finally, 91% of those who use board management software felt confident in their board’s security, while 78% of respondents who don’t use it felt confident in theirs.

While those disparities might not seem significant on the surface, consider this:

  • Board meetings often occur infrequently, such as once every three months, and typically last multiple hours. That puts efficient, effective, well-communicated meetings at a premium. An 11% increase in effectiveness could mean the difference between a smooth meeting that produces solid results for your organization, and one that falls short of those objectives.
  • The average cost of a data breach in 2021 was $4.24 million, according to an IBM report. That’s a 10% increase from 2020. Is a 13% increase in board security the difference between a data breach and secure board communications?
Board member engagement is the primary driver of board effectiveness. The ability to focus on strategic imperatives also defines board effectiveness, according to respondents.

Here’s what board leaders told OnBoard that prompted this conclusion:

  • 49% of respondents say a more engaged board is a primary driver of board effectiveness
  • Board leaders ranked “focus on strategic imperatives” as the primary way they measure effectiveness, by a wide margin (see chart below). “Governance and continuity,” “Establish and hit financial goals,” and “Meet shareholder needs” ranked second through fourth, respectively.
  • Maybe most importantly, boards that already utilized board management software maintained efficient use of board time (defined as 3 to 3.5-hour-long meetings) before and after the COVID pandemic forced remote work (see chart below).
  • Meanwhile, first-time tech-enabled boards required more meeting time (roughly 4 hours)
  • But there’s good news for those folks: With adoption and better utilization of technology, new customers drove meeting time down, and efficiency increased.

One of OnBoard’s newest portal features is Meeting Feedback, which launched in October. It enables boards to create a continuous feedback loop to help improve meetings.

OnBoard’s aggregate data shows 1,680 board members from 29% of boards overall gave a 4.49 score on their meetings, on a 1 to 5 scale. While it wasn’t an overwhelming negative, the biggest negative centered around time management.

Another new feature, board assessments, enables boards to gather anonymous, honest feedback from board members. While board members scored every category of board management a 4 or higher, “Meetings, Agendas, and Materials” scored lowest (4.03). This shows a great opportunity for boards to further utilize software such as Agenda Builder, Minutes Builder, and others to bolster those aspects of their meetings.

The third conclusion from OnBoard’s Board Effectiveness Survey results will come soon in a separate blog.

Want more in-depth survey results and analysis? Watch our Atlas Leadership Webinar series, “Board Effectiveness in 2022.”

There’s a Clear Appetite and Need to Use Technology to Improve Board Effectiveness, Including Challenges Around Innovation & the Need to Attract Diverse Directors

An effective board is one that’s able to accomplish more for the organization it serves. Our survey explored the areas where boards are particularly effective, where they’re falling short, and what role technology plays in improving effectiveness in the following areas.

Board Continuity

Change is inevitable. Board directors join and exit the board on a regular basis, and business priorities are always shifting. Boards must ensure continuity – in spite of this constant change.

It’s clear continuity is a key focus, as 80% of boards feel this is an area in which they are effective. However, there’s a notable difference in effectiveness between those who use board management software and those who don’t. While 87% of boards using board management software feel they are effective in board continuity, 72% of those without board management software feel this way.

Environmental, Social, and Governance (ESG)

In the past few years, headlines have been filled with reports of environmental disasters, racial injustice, and alleged abuses by leaders. As such, there’s been increased pressure on boards to be proactive on environmental, social, and governance (ESG) issues.

However, our survey found that 66% of boards feel this is an area in which they’re effective. Those with board management software are significantly more likely to be effective in this area (71%) than those without (60%).

Board recruitment

Having the right blend of skills and background is key to the effectiveness of any board. Boards must identify where gaps exist, and recruitment efforts must focus on filling those gaps.

But for many boards, recruiting continues to be a challenge. Today, just 61% of boards indicate they’re effective at recruitment. This number is slightly higher – 62% – for boards that use board management software.

While recruiting for the right skills is important, it’s becoming increasingly vital to also recruit board members with diverse backgrounds. As Peter C. Browning (Founder and Managing Director of Peter Browning Partners, LLC and author of The Director’s Manual: A Framework for Board Governance) put it in a recent OnBoard webinar, focusing on diversity, equity, and inclusion (DEI) in the boardroom is “not optional. Rather, it must be a top priority.

Yet, 62% of boards feel they are effective with board diversity, leaving plenty of room for improvement. This percentage is two points higher – 64% – among boards with board management software.

Of course, there are many aspects of improving board diversity. For starters, boards must aim to recruit more women – as well as more people of color.

Boards must also aim for greater diversity in terms of age. However, this is a key challenge of many boards. A mere 44% of boards feel they are effective in attracting a younger demographic.

Take Action to Improve Board Effectiveness

While many boards are excelling at continuity, far fewer feel their ESG and recruitment and diversity efforts are hitting the mark. Here’s what boards can do to improve their effectiveness in the 5 key areas we’ve discussed, based on our survey findings.

As asset managers including BlackRock and Vanguard make their DEI stances clear, boards are under more pressure than ever to focus on diversity. This includes diversity in gender, race, geography, age, and experience – among others. It’s essential to identify gaps in your board and focus your recruitment efforts on filling them.

Boards with board management software surpass those without in nearly all areas of board effectiveness. The right technology can streamline and simplify all aspects of board management, including communication, continuity planning, and recruitment.

Want to learn more about the top trends and drivers of increased board effectiveness in 2022? Check out the full survey.

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