As we’ve written about before, having a Board can be of immense value, regardless of whether you are a start-up business or an established SME. Below are five ways a Board can add immediate value to your business.
The Board sets the organisation’s strategy - short, medium and long-term. Think of it as your governing body and custodian.
The Board are not involved in the day to day operations (or should not be). This allows them to look forward at opportunities and deliver the best possible growth for your business. Equally, it allows them the room to identify potential risks and formulate strategies to mitigate them.
An independent Board is an effective way of accessing and tapping into diverse skills, knowledge and experience, without the price tag and commitment of an employee. The range of skills you choose to recruit will be dictated by the strategic direction and needs of your company.
It is important to consider the structure and composition of the Board. By this, we mean making an effort to ensure your Board is composed of Directors or Mentors who have a wide range of skills and industry experiences. It goes without saying that the more diverse the skill set of your Board, the more opportunities the organisation will ultimately have available to it.
A well appointed Board will open doors and help you to make new connections.
Similar to using your Directors to gain new knowledge or skill set for the organisation, having a Board can be an effective way of recruiting more people to ‘spread the word’ and create potential opportunities.
This is particularly the case in a small business community and it can be an effective way to tap into resources that might otherwise be expensive, overlooked or underestimated.
Accountability can be viewed from two perspectives.
Firstly, your directors should hold the utmost accountability for their duties and their decisions. Their fiduciary duty to act in the best interest of the organisation with proper purposes, and to avoid conflicts of interest, means that your business is well protected against any fraud, deceit and wrongdoing. This duty provides your business with strong protection legally; more so than any other alternative platform. It also should provide you as a Director or Founder with an added level of comfort and confidence.
Reporting to a Board also brings in an added level of accountability for the management team. In organisations where a founder or Director is also in a CEO role, this can be invaluable. Bringing in a Board often allows the CEO to relinquish some of the areas in which they aren’t trained or knowledgeable, letting them focus instead on the areas in which they excel. A strong Board will also hold the CEO accountable, where and when it is necessary.
Lastly, one that is often overlooked is that your Board guides the culture of your organisation.
Culture is more than a buzzword, it is the foundation that guides your employees on the values and priorities of the organisation and essentially, it should be a fundamental principle which underpins every element of how you do business.
This article was written by Partner, Joanna Andrew.
Practice Area: Corporate, Commercial & Business