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Board-Shareholder Communication – Silence is no longer golden for boards of directors. New disclosure requirements give shareholders much greater access to their elected representatives, the board of directors. Shareholders are deciding how effectively the board is providing oversight.
Boards that turn a deaf ear to shareholder concerns will pay the price of increased withhold votes and Vote No campaigns. The impact of such dissonance goes beyond the boardroom, casting a negative light on company and management reputation. Smart CEOs see the importance in fostering a strong and independent board.
Board Communication Policy—What are the board’s “rules of the road,” a guide of what to do when? How do directors respond when shareholders call them at home? Do you have a designated board spokesperson for situations when the board must communicate independently from management? In our experience, a well-reasoned communication policy can be the difference between a managed event and a crisis that damages the organization and the reputation of individual directors.
Shareholder Engagement Program–How is your board handling the current proxy season? What will it mean for your annual meeting? Did your board choose to hide behind legalese in handling the new regulations governing the Compensation Discussion and Analysis? Or, did you provide an executive summary describing the philosophy that governs the board’s approach to compensation? With the ban of broker voting and the threat of Vote No campaigns on individual directors, do you understand your shareholders views? A strategic communication program that identifies and integrates the shareholder perspective is an essential component of board oversight.
Annual Meeting Preparation–Is your board prepared for the new era of annual shareholder meetings? If you think 2010 is “business as usual,” you may be in for a surprise.
Smart boards will anticipate the mood of their shareholders and use the meeting as an opportunity to set the stage for greater interaction. These boards recognize that such outreach enables them to frame the conversation with shareholders. The annual meeting als provides a great opportunity for boards to listen to shareholders. Karen Kane Consulting can take your board through an array of best practices that may include but not be limited to the introduction of the board and reports from board committee chairs. Occasionally, it also means that a board member may take a shareholder question. What better way to demonstrate the board’s understanding of critical issues and its involvement in oversight?
Crisis Communication—Being prepared in advance of a crisis is not only reassuring for board members but enables directors to execute much more effectively in a crisis should one arise.
