Frameworks for assessing the performance of boards 7 / 12

Frameworks for assessing the performance of boards

Appraisal of the board's performance is an important control over it.

Aimed at:

  • improving board effectiveness,

  • maximising strengths and

  • tackling weaknesses.

The UK Corporate Governance Code recommends that performance of the board, its committees and individual directors should be formally assessed once a year.

Ideally the assessment should be by an external third party who can bring objectivity to the process.

The appraisal of the board should include:

  1. A review of the board’s systems (conduct of meetings, work of committees, quality of written documentation)

  2. Performance measurement in terms of the standards it has established, financial criteria, and non- financial criteria relating to individual directors

  3. Assessment of the board’s role in the organisation (dealing with problems, communicating with stakeholders)

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