Board Packet Purge

Good governance and strategic vision are influenced by the materials that the board sees and hears. It’s important to periodically take stock of those materials to make sure they are not only  aligned with strategic goals, but that they also useful. Boards are often resistant to the board packet purge, opting to add materials, but never reduce.

By Kevin Smith

How many pages is your board packet? Seriously. Go check. How much does that vary month to month? And how many times have you gotten that packet before a board meeting and let out a bit of a *sigh* as you get ready to review it? Be honest. I remember doing it when I was on a supervisory committee. It can be a daunting task. At least we no longer live in the age of paper board packets that take three days for your staff to photocopy and then send out via FedEx. (Please tell me you don’t have paper packets still! If you do, email me privately. We’re going to chat.)

There are very few credit union jokes, but the one that I know is this: “What is the most terrifying sound to a credit union CEO? Answer: The sound of a board packet being opened at the beginning of a board meeting.” 🙂 

In some ways the digital board packet can make things worse, because it is so much easier to add reports, data, detritus and links to spreadsheets in the digital realm. This just adds to the volume. Consider how much time the board spends as individuals reviewing dozens (and dozens) of pages each month. You want this to be valuable time.

Take Stock

It’s time to go through the packet and take stock of what’s in there, determine if/how it connects to the strategic plan, and figure out how to winnow things down to what’s necessary and useful. I’m not suggesting that the goal of this exercise is to get the packet as small as possible. The goal is to make it as useful as possible.

What we often hear when advising boards about this process is that they discover a couple or ten reports that are in the packet every month, and always have been, that no one currently on the board knows why they’re there. Often it was something that a former board member asked for years ago that got added, and there it remains. New board members join and absorb the culture of the board and its packet, and presume this is something that they need to know and understand. They simple accept it as part of the status quo. It might be something that was tied to a strategy approach that is long gone. But there it remains. If the board can purge even a couple of items like this, it is moving towards greater efficiency.

Ties to Strategy

The goal of the packet is to inform the board about how the credit union is moving towards its strategic goals and to provide relevant context. Make sure every item has a direct connection at the appropriate level of detail. This level of detail should also evolve, depending on where you are in the process. For example, a brand-new branching strategy will require more detail at the beginning and you will trim it after some time and progress. Avoid having items that are locked in place once they are added. The packet should evolve, expand and contract regularly. It is not static.

Reigning in the Directors

One approach to the packet is to make sure that any potential new additions come to the full board for consideration and a vote before adding them. Also, get the CEO’s very honest thoughts on any additions. This should be a written policy. The board then must force itself to think about how the new information will serve to inform the strategic governance of the board and avoid individuals who just want to see things.

No Perfect List

Of course, I know that what you’re looking for from TEAM Resources right now is the perfect list of items to put in the packet. And of course, you know, if you’ve heard me before, my answer is “it depends.” There is no perfect list. You need to customize this to your credit union, to your strategic plan and to the culture of your board. That doesn’t mean that you shouldn’t take on this project in the effort towards efficiency.

Dashboards

The visual representation of data is your absolute friend here. It’s so much easier and more efficient to have your information in dashboards that show you trends and targets. My snarky response is that I want to be able to take off my trifocals and be able to tell whether the trends are on target or heading astray. If they’re on target, I don’t ask any more questions.

The Arguments

There are a couple of common arguments about slimming down the board packet. One is that the board has a fiduciary duty to oversee what’s happening in the organization and that involves examining the individual numbers. I agree about the fiduciary duty. But once you learn where the numbers are coming from and that you can trust them, then the dashboard is sufficient and efficient. This also helps keep directors from getting too far into the weeds. (I’d also suggest that the auditors are far better at this kind of work than your average director.)

Another argument is that the board should have access to any and all data in an effort towards transparency, so that the CEO or staff aren’t “hiding” something. This is reasonable and it’s easy to link to the deeper data for an occasional review outside of the norm. This is also often where new directors learn the ropes of the financial. Learn it well enough and quickly enough to know what you can ignore. And consider that it is also possible to “hide” things by burying the board in date.

Not a “One and Done”

Over the years, Tim and I have encouraged this process and have seen some success. Remember, this is about efficiency. Make sure your meeting preparations are worthwhile and not mind-numbing reviews of hundreds of pages. So, if you’ve done the packet purge and found efficiencies, don’t presume that you’re done for a generation. Repeat the process every couple of years. The more often you do it the quicker it will be as well.

Strategic Efficiency is the goal. We cannot afford to waste time.

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