Your Board members lead jam-packed lives and only have time for the most pressing and serious issues when they meet. This is why an executive committee is needed to meet and tackle the high-level issues, either in emergencies or on a day-to-day basis. The executive committee is an elected, elite group of directors that are able to meet and make decisions at short notice. The executive committee is made up of the C-Suite of the board as well as other executive managers that may not be regularly at board meetings.
Whether your executive committee meets regularly and what they do will depend on your organisation’s charter and size. According to the Wall Street Journal, the average board is 11.2 members large. These members can be spread across the country or even the world. An independent director may have other commitments and be unable to meet at short notice. An executive committee is usually made up of 3-7 members who play an active, full-time role in the organisation.
Who is on an Executive Committee?
As mentioned, the executive committee is usually made up of the C-Suite, whose roles and responsibilities you can read about in our article about board meetings. The C-Suite consists of the Chair, Corporate Secretary, and the CFO or Treasurer. The other executive managers that attend the executive committees are the CEO, Vice-Chair. Some larger corporations even invite the heads of different sectors, such as the Chief Information Officer. However, having more than 7 members on the executive board is not recommended because the selective nature of the committee ensures its practicality. It is important to not have too many cooks!
What are the benefits of having an Executive Committee that meets regularly?
With regular executive committee meetings, problems can be discussed informally so solutions can be put forward to the board. This can also involve determining which issues of a high-level nature get heard by the board and coming up with solutions for those less pressing. It is also useful if the executive committee decides on an agenda for each board meeting together as this allows for the streamlining of processes.
Another benefit of having an executive committee that meets regularly is that they can create consent agendas for the board. This allows the board to just sign off on action items without need for a long discussion as this would have been debated by the executive board already. This should only be for routing non-controversial items so the board can focus their energy on the important motions.
The executive board can also be responsible for overseeing the organisation’s standards, guidelines and regulations. They can monitor the objectives and values on a more regular basis than the board and check that the organisation is up to scratch. If needed, they will form and sunset ad hoc committees to ensure that their goals for security, ethics and quality are reached. This reduces the burden on the board, so they can focus on the bigger picture rather than the day-to-day issues.
Some organisations use the executive board to habitually monitor the finance committee. They would deal with the investments and investors associated with the organisation. The executive committee could be responsible for the daily oversight of the outgoings and incomings to ensure that there are no gross errors. Other organisations use the same directors of the executive committee but rename it as a finance committee. The renaming allows the separation of powers to be given to the executive committee in the charter.
It is easier to bring together the executive committee on shorter notice than a board of directors. The majority of executive committees do have full powers to act on behalf of the board in certain circumstances, and are the ones who convene in emergencies. This means in a crisis, having an executive committee is a necessity. Having one that can act without the board meeting is a bonus.
What are the disadvantages of having an executive committee that meets on a regular basis?
There is a risk if you have an executive committee that meets frequently that you could create an insular committee, excluding the board from having a say. The worry is that the executive committee forms a clique that dominates in the board meetings or worse, makes them redundant. It is important to make sure the board still has a role to play. The executive committee should allow for dynamic discussions and follow the decisions of the board.
The Executive Committee and The Board of Directors:
It is essential that the executive committee be accountable to the board. They should ensure that minutes of each executive committee are taken and presented at every board meeting. The Executive committee could make the board meetings productive by streamlining the issues that are put in front of the board. The board should only have to deal with the most important problems, while the executive committee deals with the rest. The facts should be clear on any issues and potential options should already be discussed
How to improve your Executive Committee meetings?
Convene’s unique board portal solution can help streamline your executive decisions at every level. Our access controls allow papers to be viewed on a need-to-know basis, and are all stored within the best security systems, either in the Cloud or your own Servers. Convene also allows for simple minute-taking features, so presenting them to the board will be even easier! Our top tips for meeting minutes have been useful for many of our customers.
Convene is now also available fully integrated with Microsoft Teams. This means your executive committee, senior leadership team, board and beyond can all enjoy the full benefits of a board portal during their meetings. From creating an agenda with a simple drag and drop, to automated reminders on any Action Items set, your governance processes will be made more efficient start-to-finish.
To see how Convene can help you, don’t hesitate to talk to our customer service team or book a demo!