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© 2015 Langoor Digital Pvt. Ltd. | www.langoor.com1 © 2015 Langoor Digital Pvt. Ltd. | www.langoor.com1
Boards 101
By Ruch...
© 2015 Langoor Digital Pvt. Ltd. | www.langoor.com2
An Agency of Shareholders
Shareholders /
Members
CEO
Management
Board ...
© 2015 Langoor Digital Pvt. Ltd. | www.langoor.com3
Brief History
Informal examples include :
 Governing councils & Parli...
© 2015 Langoor Digital Pvt. Ltd. | www.langoor.com4 © 2015 Langoor Digital Pvt. Ltd. | www.langoor.com4
The Board Governs ...
© 2015 Langoor Digital Pvt. Ltd. | www.langoor.com5
Purpose
Further interests of the Organisation
Define and assess strate...
© 2015 Langoor Digital Pvt. Ltd. | www.langoor.com6
When?
Entrepreneur with Advisors
(<$2Mn)
Advisory Board
(<$15-20Mn)
AS...
© 2015 Langoor Digital Pvt. Ltd. | www.langoor.com7
Ideal Board Size
Preferably always less than 10
Preferably an odd numb...
© 2015 Langoor Digital Pvt. Ltd. | www.langoor.com8
A Good Board
Mix of Skills & Experience
Strategy
Financial Prudence
Co...
© 2015 Langoor Digital Pvt. Ltd. | www.langoor.com9
Director’s Duties & Responsibilities
Fiduciary Duty
 Fiduciary duty i...
© 2015 Langoor Digital Pvt. Ltd. | www.langoor.com10
Role of the Chair
 Single most important role in
determining effecti...
© 2015 Langoor Digital Pvt. Ltd. | www.langoor.com11
The CEO Relationship
 Single most important function of the
Board is...
© 2015 Langoor Digital Pvt. Ltd. | www.langoor.com12
Board Remuneration
 Depends on stage of your business
 A stipend + ...
© 2015 Langoor Digital Pvt. Ltd. | www.langoor.com13
Independence of the Board
Executive v/s Non-Executive
 Managing Dire...
© 2015 Langoor Digital Pvt. Ltd. | www.langoor.com14
Board Operations
 Role of the Agenda
 Planned agenda really useful
...
© 2015 Langoor Digital Pvt. Ltd. | www.langoor.com15
Committees
 Committees useful to “delegate”
deliberations in key are...
© 2015 Langoor Digital Pvt. Ltd. | www.langoor.com16
Questions?
 It is easy to over cook the process
 Start incrementall...
© 2015 Langoor Digital Pvt. Ltd. | www.langoor.com17 © 2015 Langoor Digital Pvt. Ltd. | www.langoor.com17
Thank You
Langoo...
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Governance & Boards for Companies & Not for Profits

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People often ask me about Langoor's Board of Advisors or approach me to be on their Board. In this presentation I lay out the basics of a Board of Directors, Board of Advisors and Statutory Boards. There is a small Australian compliance flavour to it, but generally it is applicable for Boards and good governance around the world.

I originally prepared this presentation for a group of friends looking to setup a Board for their organisations.

Published in: Leadership & Management
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Governance & Boards for Companies & Not for Profits

  1. 1. © 2015 Langoor Digital Pvt. Ltd. | www.langoor.com1 © 2015 Langoor Digital Pvt. Ltd. | www.langoor.com1 Boards 101 By Ruchir Punjabi
  2. 2. © 2015 Langoor Digital Pvt. Ltd. | www.langoor.com2 An Agency of Shareholders Shareholders / Members CEO Management Board of Directors Committees
  3. 3. © 2015 Langoor Digital Pvt. Ltd. | www.langoor.com3 Brief History Informal examples include :  Governing councils & Parliaments  East India Company Formal :  Courts in England recognised the relationship between the shareholders and a Board in 1904
  4. 4. © 2015 Langoor Digital Pvt. Ltd. | www.langoor.com4 © 2015 Langoor Digital Pvt. Ltd. | www.langoor.com4 The Board Governs and the Management Manages
  5. 5. © 2015 Langoor Digital Pvt. Ltd. | www.langoor.com5 Purpose Further interests of the Organisation Define and assess strategy Trade solvently Drive financial performance Hire, manage and fire the CEO Manage legal, OH&S, compliance and all other risks (Australia)
  6. 6. © 2015 Langoor Digital Pvt. Ltd. | www.langoor.com6 When? Entrepreneur with Advisors (<$2Mn) Advisory Board (<$15-20Mn) ASX / Compliance Specialists (Post-listing Experience) Statutory & Executive Board (Pre-Listing or >$20Mn)
  7. 7. © 2015 Langoor Digital Pvt. Ltd. | www.langoor.com7 Ideal Board Size Preferably always less than 10 Preferably an odd number Organisation / Board Ideal Number Advisory Board 3 to 5 Listed Board / Large Organisation 5 to 9 Not for Profit 7 to 9
  8. 8. © 2015 Langoor Digital Pvt. Ltd. | www.langoor.com8 A Good Board Mix of Skills & Experience Strategy Financial Prudence Compliance Independence & Accountability Credibility (inc. Fundraising for NFPs)
  9. 9. © 2015 Langoor Digital Pvt. Ltd. | www.langoor.com9 Director’s Duties & Responsibilities Fiduciary Duty  Fiduciary duty is a legal duty to act solely in another party's interests (in this case, the org)  Act in good faith for a proper purpose  Avoid conflicts of interest and not misuse information or position  Act with care and diligence  Specific duties related to laws (insolvency, declaration of interests, etc)
  10. 10. © 2015 Langoor Digital Pvt. Ltd. | www.langoor.com10 Role of the Chair  Single most important role in determining effectiveness of a Board of Directors  Key liaison between the Board and the CEO (inc Management)  mentor and sounding board for the CEO  Ensures that the information flow to the Board is comprehensive  Creates an effective environment for robust discussions
  11. 11. © 2015 Langoor Digital Pvt. Ltd. | www.langoor.com11 The CEO Relationship  Single most important function of the Board is to hire, fire and manage the CEO  Enablement and Accountability of the CEO crucial to the organisation’s success  Create an environment for the CEO to leverage the Board to help the CEO and organisation reach their full potential
  12. 12. © 2015 Langoor Digital Pvt. Ltd. | www.langoor.com12 Board Remuneration  Depends on stage of your business  A stipend + expenses normal  Vesting of shares over time also a common option  NFPs normally only cover expenses  A remuneration committee can help  Surveys available (similar to employee pay surveys)
  13. 13. © 2015 Langoor Digital Pvt. Ltd. | www.langoor.com13 Independence of the Board Executive v/s Non-Executive  Managing Director v/s CEO Different countries have different trends on independence  Consistently however independence is considered positive
  14. 14. © 2015 Langoor Digital Pvt. Ltd. | www.langoor.com14 Board Operations  Role of the Agenda  Planned agenda really useful  Distribute papers in advance  Focus on high-level discussions; keep details for noting  Secretary of the Board and/or Company  Committees
  15. 15. © 2015 Langoor Digital Pvt. Ltd. | www.langoor.com15 Committees  Committees useful to “delegate” deliberations in key areas  A Board can never delegate responsibility i.e. committees only recommend – Board doesn’t have to adopt the recommendations  Example committees include Audit & Risk, Investment, Infrastructure, Appointments & Nominations, etc.  Also an opportunity to leverage expertise in different areas
  16. 16. © 2015 Langoor Digital Pvt. Ltd. | www.langoor.com16 Questions?  It is easy to over cook the process  Start incrementally and build on the process  Add people slowly over time – no need to rush but key to get people and Board culture right  Chair and CEO roles and their relationship crucial to the success of the Board ?
  17. 17. © 2015 Langoor Digital Pvt. Ltd. | www.langoor.com17 © 2015 Langoor Digital Pvt. Ltd. | www.langoor.com17 Thank You Langoor info@langoor.com Sydney, Melbourne, Ahmedabad, Bangalore, Hong Kong, Singapore www.langoor.com

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