Bored with board papers? - Write to govern

1 AUGUST 2006 KEEPING GOOD COMPANIES400 Key IssuesAgood set of board papers is essential foreffective well-constructed set of board papers gives anoverall picture of the organisation at a point intime and highlights the decisions that need to bemade at a particular board rely on board papers to provide themwith the right information so they can makedecisions affecting a company s financial andstrategic future. The papers are also a formalrecord of the board s decision-making board papers not only providecomprehensive financial data, but also givemanagement s view of the major strategic issuesconfronting the company. So management has aresponsibility to flag problems and possibilitieswith clarity and failure of some high-profile companies,both here and overseas, gives cause to wonderwhy the directors were not better informed. Thetelecommunications industry was gossiping aboutOneTel, so why didn t the directors know? Whydidn t management keep them informed of all therelevant issues?

2 Responsibility lies with directors to find out asmuch as they can if they are concerned about thedirection of a company and the information theyare receiving. Yet at the same time, boards mighthave saved some recent company failures had theyconsistently received comprehensive, relevantboard papers about strategic and financial is not just companies that have gone downthe gurgler that have received poor board boards that appear to perform well alsomake decisions based on inadequate or poorlywritten board papers and sometimes have to relyon the CEO s guidance or their own quality of corporate governance has neverbeen more crucial with the increasing demandsplaced on businesses by globalisation and complexfinancial reporting with board papersMany board papers are not fit for the purpose ofgovernance. They are not appropriate for theaudience and are overly lengthy, far too detailed,poorly laid out and badly written. A lot of materialprovided in some board papers is simply not for management, notgovernanceOne of the main problems with many boardpapers is that they are written for managementrather than directors.

3 A reason sometimes givenfor this fault is that many writers have notreceived training about the distinction betweenmanagement and a result, boards often receive a lot ofunnecessary and irrelevant information about day-to-day management issues that can distract themfrom their governance role. Often the personediting the board paper will weed some of thisinformation out, but this should not be their based on shared knowledgeMany writers of board papers are so familiar withthe material they are writing about they makeassumptions that everyone else shares theirknowledge. They do not appreciate that althoughthey are writing for an intelligent audience, theirreaders will not have their depth of understandingon the all make this mistake. And we often do itwithout even realising. When we own an area ofexpertise, we forget how long it took us to gainour back to when you first worked in anew industry and how overwhelming thelanguage seemed.

4 I m sure we ve all had theexperience of trying to read a document that looksCOMPANY SECRETARYB ored with board papers? Common problems with board papersand how to avoid them Practical tips and techniques forproducing high-quality, appropriateboard papers Checklists to help maximise effectivenessand minimise problems in preparingboard papersBy Mary Morel, Director, The M Factor401as if it was in a foreign language. I worked in TelstraWholesale for a year and for the first few monthsmost meetings seemed to be held in Double recently, without even thinking about it, I usedthe term IT&T (information technology andtelecommunications). One of my readers had neverheard of the industry has its three letter acronyms(TLAs) and jargon. When readers are familiar with atopic, such jargon has its place, but it is directors need a glossary (which is seldomprovided) to make sense of their papers. Over time,they come up to speed, but in the meantime theirvaluable contribution is in detailBut even worse than TLA papers, are long papers thatdrown the reader in detail.

5 Many managers are sosteeped in a wealth of information they lose the abilityto extract the key messages. It is all important to are writing for themselves; not writers do not pre-sort their writing into mustknow and nice to know information. This makes itdifficult for directors to identify the key messages andcan lead to tortuous discussions about minor massaged to look good Sometimes management unintentionally does a sell job on the board . It s human nature to want to do welland be praised. And there s a temptation to show theboard what a good job everyone is doing rather thanconcentrating on financial and strategic issues and of the problems with an overly positive spin is that directors can become lulled into a false sense ofsecurity about the company s position. It is hard fordirectors to ask pertinent questions when they don thave access to the information they need to know .Poorly written and structuredinappropriatelySome writers of board papers have a natural aptitudefor writing; they enjoy writing, and are alwaysimproving their skills through reading widely andcritically evaluating their own work.

6 Others findwriting a chore and this is sometimes compoundedby a poor understanding of basic grammar and writing is an essential skill in business today,such writers may need to be encouraged to improvetheir writing even if people Write well, what some writersfail to grasp is that the way we read and digestmaterial has changed with the growth of onlinecommunication. Although we use differentconventions depending on the type of writing weare doing (for example, a report has a differentstructure from a press release), online writingtechniques have permeated all print no longer expect board papers to be writtenlike university essays with an introduction, bodyand conclusion. We don t want to wade throughscene-setting material to discover the point of thedocument halfway down the page. We expect to seekey messages spelt out simply and clearly upfrontand in our also like our reading material broken into chunks of information. So paragraphs are nowmuch shorter than they used to be, subheadings areused more and bullet points are common in mostboard writers go overboard with this new style ofwriting and prepare everything in chart and bulletform.

7 This style is economical on space, but overlooksthe fact that people read material in different ways. Iam a words person and if confronted with a graph, Ilook for the explanation rather than try to decipher long list of bullets also makes my eyes glaze over I ll read the first few and last few only. Other readerswill skip the paragraphs, but read the bullets andanalyse the graphs. A well-written board paper needsto cater for both types of layoutMany writers of board papers do not pay enoughattention to the layout of their papers, forgettingthat first impressions influence a reader s attitudetowards the content. A document that looks densewith long paragraphs or lengthy bulleted lists willscream difficult to read .A common mistake is trying to squeeze toomuch information into a tight space. White space(jargon for areas without type or graphics) is visuallyattractive. It also has another bonus for directors asthey can make their own notes on the document, even internal emails, that anorganisation produces should be in keeping with itsbrand.

8 While most organisations have templates andstyle guides determining typeface, size of fonts,heading hierarchies and so on, in my experiencewriters often break template and style rules. Not manypeople in most organisations I have worked with arefamiliar with their style guides, partly because moststyle guides are long and boring. A few organisationshave a brief mandatory style guide and monitor result of writers using their own templates canbe a set of board papers in a mishmash of differentstyles. This can cause confusion and also is distractingfrom the content. Often the person putting the boardpapers together will change all the styles forconsistency, but this is a waste of that person s how can writers of board papersimprove their writing? board sets the parametersBoards need to be clear about what they expect fromboard papers. They need to identify whatoperational reports they must receive regularly andwhat these should cover. For example, they maydecide they need regular updates on infrastructure,people and development, key client groups, keyprojects and key risk Issues COMPANY SECRETARYAUGUST 2006 KEEPING GOOD COMPANIES402 COMPANY SECRETARY continuedKey IssuesThe board may also decide that major chewy strategic issues of substance that do not necessarilyneed decisions also be on the agenda anddiscussed.

9 Such papers could be in narrative,rather than bullet form, and be distributed to awider audience for boards annually evaluate how the boardis functioning and this may be an opportunity toevaluate their agenda and board papers. Forexample, a company may decide that they wanttheir agenda to be recommendation-focused,based on position papers. An advantage of thisapproach is that the minutes then flow out of theagenda items so are quick and easy to Write part of the same exercise, boards also need todecide what form they want their minutes to there are different styles of minute-taking,many board minutes today are short and concise,showing what was decided, not who said sheets often accompany minutes, recordingwho is responsible for what action and by for writers of board papersAlthough most writers of board papers will beconversant with plain language principles, PACKOis a useful memory jogger when they are writingboard papers. It stands for purpose, audience,context, key messages and use PACKO before I start writing a use it again when I have finished my first draftas when writing I can become so involved in mycontent that I lose sight of my writers are clear in their own mind about whythey are writing a board paper it will help themstructure their material appropriately.

10 For example,if their purpose is to recommend a capitalexpenditure, their recommendation will comefirst, followed by the supporting information. Iftheir purpose is to inform, they may start off withsome background information about the writers Write with their audience firmly in mindtheir papers will be more relevant. They will findit easier to decide what information is relevantand what they can safely leave out. They will beless likely to deluge directors with writers find it difficult to leave material out,especially if it is interesting. But if they askthemselves Is this relevant for the directors? or Sowhat? , the decision will be easier. They will find thebalance between essential and unnecessary well as not making assumptions aboutdirectors knowledge, writers also need toremember that directors are busy people. Manydirectors only receive their papers 48 hours beforethe board meeting, so all papers need to be as shortas possible.