For the past few months, Alex Todd of Trust Enablement Incorporated, has been conducting a survey to determine to what extent corporate directors feel they are receiving sufficient support to perform their duties. Although he has already compiled interim results, the survey will remain open in order to obtain a sufficiently large sample size for a more granular analysis by corporate structure and director role. All participants will receive a copy of the summarized findings. I urge all directors to complete the survey, which only takes a few minutes.
As of the end of June 2010, 59 responses had been received, with approximately a 60% to 40% distribution from directors of for-profit vs. not-for-profit companies respectively. Two thirds of the responses were provided by non-executive directors. Mr. Todd is urging more response from directors of government agencies, co-operatives, and family businesses, which have been under represented to date.
The survey finds distinct difference in responses of directors serving on boards of for-profit and not-for-profit companies but findings are aggregated until larger numbers allow higher confidence for reporting according to type, size, corporate structure, etc.
Overall, it appears directors feel their boards could benefit from more director engagement, professional development, and information resources. At the same time, corporate boards appear to be averse to investing in director development resources, especially new and innovative ones.
In summary, (download survey summary):
- Three quarters of boards do not have a director development budget. For those that do, the average was just over $8,000 per director (ranging from $1,000 to $25,000), only about half of which was actually spent. What was spent, was used mostly for informal director education, such as seminars and workshops.
- Although all or most directors arrive to board meetings fully prepared, about a third reported all or most directors to be only occasionally or rarely prepared.
- More than half of directors reported they rarely of occasionally make use of additional resources beyond directors’ briefing binders, despite most occasionally or frequently having unanswered questions while preparing for meetings; most frequently they want to know what else they should consider before taking a position on an issue.
- More than 40% of directors report that at least one or a few directors on their board are insufficiently engaged, and have insufficient knowledge and intellect to perform their duties. However two thirds report that all or most directors exhibit professionalism in the boardroom, despite almost half reporting that at least one or a few directors do not apply appropriate board procedures nor make use of a sufficient variety of information sources, with more than a quarter reporting the same for all or most directors.
- Formal and informal director education top the list of most desired resources to help directors do their job. There is also interest in having access to support services from internal corporate staff, self-serve online information and research services, live on-demand director Q&A support resources, and access to external subject matter experts.
- Impact on board performance, provider credibility, and compliance requirements top the list of board criteria for approving additional director development resources.
- Two thirds of directors felt it unlikely that their boards would be willing to BETA test an innovative new services to help directors do their job better. Half of those would only consider doing so if the service were endorsed by a trusted internal source, such as the board chair or corporate secretary.