Getting the Most out of a Board Evaluation Survey

Not for Profit organisations are increasingly undertaking Board evaluation processes to assist in improving Board performance and effectiveness. Not for Profit Consultant Michael Ford offers his top tips on getting the most of of a Board evaluation survey.

Board evaluations are well established in Australian companies as being an essential tool for measuring and improving company performance. Increasingly, Not for Profit organisations are also undertaking Board evaluation processes to assist in improving Board performance and effectiveness. But how effective are the processes that they are using?

Tried and Tested

The most common tool used by organisations to evaluate Board performance is a survey, usually delivered online.

There are two common survey methods used by contemporary Not for Profit Boards:

• a general whole-of-Board evaluation survey, where Board members rate collective performance on a range of governance, strategy, behaviour and teamwork measures; and
• a peer review survey, where Board members confidentially rate themselves and their colleagues on a range of key measures.

It is best practice to alternate between these forms of evaluation from year to year, and generally to use the same or similar sets of questions in every two-year cycle in order to analyse trends and to track improvement (or deterioration) in results.

Many Not for Profit organisations tend to rely on Board evaluation surveys that are freely available online, though these can fail to recognise the unique context of their organisation or industry. It is always best to customise a Board evaluation survey to ensure you are asking only the questions that matter to your organisation, and that organisational priorities or industry-specific matters aren’t missed out.

To achieve the best and most honest results, it’s important that an independent, external facilitator administer the Board evaluation survey. These services can be very affordable, particularly for charities and Not for Profit organisations, but it that isn’t an option it’s a good idea to appoint a single person – preferably not a Board member – to administer the survey, such as the executive assistant to the CEO or the company secretary.

Bigger Isn’t Better

Many surveys available online can consist of over 50 questions. Longer surveys can create issues with the accuracy and reliability of the data produced – when providing feedback on a range of generic governance measures, Board members tend to become disengaged or complacent with a certain score range for their response, without proper consideration of each question. In a long peer review survey, Board members can become harsher ‘markers’ throughout the course of the survey, disadvantaging those Board members placed towards the end.

It is essential that Board evaluations are short and to the point, covering a range of broad areas that can be further interrogated if a problem is in fact identified. In a general survey, 16-20 questions should be sufficient to have an accurate idea of the Board’s strengths and weaknesses. In the case of a peer-review, five or six key questions should be developed and applied to each Board member.

Apples and Oranges

No two organisations are the same, and so the Board evaluation process should be adapted to the particular circumstances of the organisation, such as the tenure of Board members, the stage of the strategic planning cycle, and the organisation’s regulatory obligations.

In particular, if using a survey available online, it’s important to recognise that any suggested benchmarks may not necessarily be appropriate for your industry. Governance is important in all organisations, but no doubt members would expect a far higher standard of governance on the Board of a social service organisation working with thousands of clients and a budget of millions than the committee of the local footy club down the road. The only true benchmark is the standard a Board sets for itself.

The Board’s Harshest Critics

The relationship between the Board and senior management is critical for effective Board performance, information flow and strategy development. In larger organisations, staff members that have regular interaction with the Board can be included in the Board evaluation survey process. Examples of staff to include are the CEO, company secretary, finance manager, operations manager and other managers or staff who report to or work with the Board on a regular basis.

Where appropriate, it may also be worthwhile having other stakeholders participate in the process, such as government. This should only occur where a stakeholder has regular interaction with the Board and its governance processes, to ensure the inclusion of accurate perceptions.

Staff and stakeholders should comment only on the Board as a whole, and not participate in processes of peer review (except the CEO, where the CEO is a member of the Board). It is also important that the survey be appropriately modified or trimmed for staff and stakeholder participation, to ensure that these groups answer only those questions that are relevant to their role and cover issues of which they would have sufficient knowledge to comment on.

Staff and other stakeholders can bring a unique perspective, and identify governance or reputational issues that otherwise may not have been picked up.

Take the Process Seriously

One of the most important and valuable stages is the presentation of results to the board; an open and frank discussion about the results and solutions to under-performance. If the Board has engaged an external facilitator to run the survey, it can be useful to have them facilitate the follow-up Board discussion, as well as advise on the Board members’ personal and professional development.

Issues that have been identified from the survey can then become the focus of a greater project for the Board – whether it be a review of the organisation’s governance, renewal of the Board’s membership, increased training opportunities for Board members or a workshop to review the strategic plan.

Most importantly, the survey is only the start of the Board evaluation process, not the culmination. There is no point engaging in a Board evaluation survey process if no action is going to come of it.

About the Author: Michael Ford is an Associate Consultant at the Radno Group, a Melbourne-based consulting firm that provides strategic advice to the Not for Profit sector. With an educational background in community development and corporate governance, he has extensive experience on community and Not for Profit Boards. Michael currently sits on the Board of a youth mental health foundation and a national anti-bullying charity, and is a member of a Victorian Government Ministerial Advisory Committee.