Despite the importance of a board performance plan, relatively few boards actually develop their own objectives and Key Performance Indicators. Instead, most board planning time is consumed by board and committee agenda setting, meeting calendar coordination and charter reviews.
A board performance plan is the essential catalyst to transition a board from a focus on conformance to effective performance.
However, whilst most boards assess their performance, committees and individual directors through an annual or periodic review process, they rarely measure themselves against KPIs and the strategic objectives of the organisation.
Contrastingly, high performing boards develop a small number of performance objectives that are aligned with selected organisational goals where it is identified that the board can add significant value.
The strategic planning day that most boards undertake is a good opportunity to consider the areas where it can add the greatest value to the direction, decision making and performance of the organisation's strategy.
The board can then develop more explicit objectives and identify the performance markers that could be monitored for successful achievement of those objectives.
This can be the foundation of a “Board Performance Plan” to help determine what it wants to achieve over an agreed period.
This plan is separate to its charter and board performance evaluation policy, but assists in setting board priorities and annual agendas, along with chair and individual director goals and priorities.
The board performance plan then becomes the reference point for the board’s performance evaluation process and the benchmark for the extent to which the achievement of the board’s objectives contribute to the achievement of the corporate strategy.