Who can argue against the concept that Boards ought to evaluate itself?
If it does not, then it will certainly be evaluated by outside agencies.
An ongoing, structured program of Board of Director Self Evaluation can help
keep D&O rates down relative to Boards that do not engage in Self
Evaluation or do the Self Evaluation as a one time event.
Our experience is that Board Self Evaluation needs to be done in a tightly
controlled framework to avoid Board members ganging up on unpopular
people. It also needs to be tightly controlled to insure that busy
Directors aren't angry at time involved to do the process.
The purpose of Board Self Evaluation is not Self Evaluation it is to allow
the Board to conduct its business more effectively.
Boardoptions.com is working with several Boards on this issue, using National
Association of Corporate Directors standards as a tight framework. At
the same time, we are removing some of the psychometric problems associated
with the NACD instrument itself.
For a perspective on Bank Board self evaluation, go to: