The Self-Assessment of Boards is a crucial function of the board that provides a useful platform for analyzing and discussing the strengths and weaknesses of governance. It’s a method for the board to take a step back and evaluate its own effectiveness, which results in effective governance improvements.
Developing an effective board assessment process requires planning time, as well as involvement of the board members. The first step is to determine the scope of the assessment. This could include the entire board, a specific committee or individual directors. A good plan should also define the method of evaluation. The most common methods include surveys, interviews or facilitation of discussions. Once the scope of the evaluation as well as the method used have been decided, it’s time to design and distribute questionnaires.
Some boards decide to conduct the assessment on their own while others employ an outside consultant. A third party consultant can ensure a thorough, impartial analysis, which is particularly crucial when your board does not have the time or the resources to conduct the evaluation on their own.
While it is important for board members to assess themselves, it’s equally important for nonprofit boards to look at the group as in its entirety. It is easy for nonprofit boards and their evaluation facilitators to become absorbed in evaluating the responses of individual members and not take the time to evaluate the board in its entirety.
A successful self-assessment will help boards better understand their expectations of each other, reveal gaps in the composition of boards, align board expertise with the organizational strategy and address concerns of investors about diversity and turnover, and boost the effectiveness of board procedures and practices. A growing number of public companies are disclosing the results of their board evaluations in their proxy statements.
