Are you hearing feedback from your directors that your credit union board meetings are bland? Or worse, is meeting attendance in decline and you don’t know why? Chances are your meetings are getting too informational and formulaic, and need to get more strategic.
Studies show that engaging directors in strategic dialog, as well as educating them in your organization’s challenges, is essential to retaining directors and achieving productive board discussions. In this post, we’ll provide you with 20 examples of topics that you can add to your credit union board agendas to better educate and productively engage your directors in strategic decisions.
Why is director engagement in strategy important?
The data doesn’t lie – according to research by McKinsey, involving directors in strategic dialog boosts board effectiveness. And, after all the work that’s been done to recruit skilled and diverse directors, why wouldn’t you invite them to add constructive value to the corporate strategy?
If you’re hesitant to put hard questions about your organization on the table for fear of scaring off directors, fear not – directors actually want to be involved in strategic discussions. In fact, in a survey conducted by McKinsey, two thirds of directors stated that they’d like to spend additional time in board meetings discussing strategy. However, a related study found that 44% of directors are shut out from strategic dialog and are asked instead to only review and approve the management team’s proposed strategies.
Why the disconnect, then? In the same survey, only 10% of directors felt they understood the industry dynamics in which their companies operate, and, as a result, only 21% of them claimed to have a good understanding of their organization’s current strategy.
What gets in the way of inviting board members into strategic discussions?
Perhaps it’s the fear that making the board agenda more strategic will convey the message to directors that only expert input is really useful. Or perhaps it’s the fear of changing the way the board has always done things, or the view that you’re “taking away” the job of the management team. But why should your board waste time on discussions that aren’t productive with directors that aren’t appropriately engaged in the first place? Cutting board members out of key discussions will cost you. It’s common for board members to resign if they feel they aren’t contributing strategically, and properly informed directors can provide critical insight on how your organization can improve its performance.
So how can you boost board engagement and meeting effectiveness? It really all starts with educating your board in industry dynamics. With engaged and educated directors, board meetings can become more strategic and outcomes are much more likely to be productive. It also doesn’t hurt that engaged directors will gain feelings of shared commitment and understanding just from being more involved.
Board engagement plan: educational topics to add to your credit union board meeting agenda
Given that credit union boards are usually made up of volunteer members, it’s common that directors do not have much background knowledge of the credit union industry. Without that education, it’s hard for them to be actively engaged in your board meetings. Quantum Governance recently shared a post on educational sessions to consider adding to your board meetings. Here are our top 10 picks:
- What is asset liability management and how do we use it as a planning tool?
- What are the risks and benefits of business lending? What is the future outlook?
- What is the effect of current and evolving legislation on our business?
- What is the methodology for creating our allowance for loan loss?
- What is our disaster recovery plan?
- What is our succession plan and process for leadership review?
- What are our initiatives and results for membership growth?
- What are the impacts of fraud on our business?
- How do our internal controls (checks and balances) work?
- How do we measure service quality?
Ways to engage board members: strategic discussion items to add to meeting agenda
Quantum Governance also offered hot topics to prompt strategic discussions at credit union board meetings. Here’s our top 10 shortlist:
- What is our five year plan? What is our two year plan? Are we doing enough to meet our goals?
- How do we match up to our competitors?
- How should we utilize mergers for future growth?
- What is our future branch structure and model?
- What is our risk tolerance? How does our risk profile compare to our peers?
- What is our business development and community involvement strategy?
- What are current technology trends that most affect our organization today?
- What would happen if our organization was purchased by another?
- What are the current industry trends affecting our market, and what potential implications does this have for our strategy?
- What is our recruiting and onboarding process for new board members?
Board member engagement – ongoing education and engagement
Education for board members really starts before any board meeting, when directors review materials and have discussions with other board members and executives. In conversations with boards that Aprio serves, we hear that board technology that makes it easy for board members to access and review board materials anytime, from anywhere, has a significant impact on improving board engagement and meeting attendance.
With board meeting software, you provide directors with convenient, online access to a full library of board materials that’s easy to search, and simple for note taking and online discussion. You can also add links to key documents from your agenda to keep board meetings productive and on topic.
Want to know more about how to best increase board member engagement and run better board meetings? Contact us to learn more about Aprio board portal software.
