Better connections

The company secretary’s ability to successfully negotiate relationships with the board throughout its decision making is a vital skill. There are, however, tools at the company secretary’s disposal that can help them forge better relations between members, ease communication and allow for smoother running board meetings.

Key board relationships

The most important boardroom relationships a company secretary has are with the chairman and CEO. Charles Pender, independent governance consultant and member of the Insitute, explains that ‘If either of these relationships are bad, it will be very difficult to function effectively’, however he believes that ‘of the two, the strongest and closest relationship should be with the chairman’. The chairman, according to Charles, should have the ‘same perspective as the company secretary’.

A company secretary explains why this alignment with the chairman and CEO is imperative: ‘In matters of governance and the workings of the board, the company secretary should report to the chairman and not to the CEO. However, it can make sense to report to the CEO in relation to other matters, which might form part of the remit of the company secretary’s role, for example, if the company secretary is also responsible for other operational areas such as legal, facilities, communications etc.’

Yet in order to assist the chairman effectively, the company secretary also needs to have strong working relationships with all other members of the executive team. John Mills, Group Company Secretary at Anglo-American plc, says ‘you cannot do it all on your own, unless you are a small company’. Regular meetings should be held between the company secretary and each executive director and NED to ensure one-to-one engagement.

Helen Pitcher OBE, Chairman at Advanced Boardroom Excellence, adds that ‘in addition they also need to influence and support the relationships between the chairman of the remuneration committees … the audit chairman … the CFO and the many ancillary relationships which reach out from the board.’

The relationship with the CFO has, according to Pippa Begg, Director of Board Intelligence, been overlooked in the past. Company secretaries must consider it a priority as ‘around half the board pack tends to be populated with information from the CFO, so it is important … [to] work together on this.’

Developing the skills

In addition to well-developed technical knowledge and thorough understanding of the relevant laws and regulations, the company secretary must have certain personal attributes in order to connect with the board. ‘Most of what makes a board effective is behavioural’, explains Peter Swabey, the Institute's Policy and Research Director. These skills are vital when listening to questions or concerns from NEDs for example, and then feeding this back to the executive team in a way that is both tactful and sensitive. Tact is also key to the company secretary’s ability to ‘translate’ messages between board members with diverse views, outlooks and approaches.

Trustworthiness is also named a critical trait by company secretaries and directors alike. Being seen ‘to do the right thing’ is essential. Other behaviours several company secretaries noted include: ‘Empathy, diplomacy, emotional intelligence, integrity and gravitas is also useful – although not necessary in that order.’

Helen describes these skills as those which ‘go beyond the technical qualifying criteria for the role’. These skills are ‘required for both judging the moment when you make important “calls” and for sensitively coaching often more senior executive needs of the board’.

It is also necessary to understand the nature of each relationship which ‘naturally occurs through experience of the company secretary’, according to Helen. She explains that ‘the company secretary has a matrix of stakeholder relationships and it is important to map out these relationships and understand … how these stakeholders can best be managed and influenced within a stakeholder context’.

Pointing out the importance of this behavioural skills set, Helen highlights that ‘the final shortlist of a company secretary role in a FTSE 100 company will not be judged on technical expertise – all the shortlist will have those technical skills – it is how they deploy them and their relationship building skills which will be to the fore.’

Strengthening relationships

Although key relationships are built through personal contact, having the right tools in the boardroom can help to improve communication, sustain contact between the board members and keep each member ahead with the latest information. Technology in the form of tablet and mobile software, if used correctly, can be a major help in achieving this. Helen observes the ‘effort and investment over the past few years in creating a better board information pack.’

An Institute member explains: ‘Technology can assist better communication and relationships in many ways, ranging from audio calls and video links to electronic board portals, enabling papers to be distributed at the last minute ahead of a discussion, or signatures to be captured by scan from remote locations. It is easier to distribute ... large quantities of back up information for those who wish to work through specific details.’

Digital board packs, in particular, can help to improve efficiency in the boardroom by reducing the cost and time of preparing board materials and, with the use of web-based administration portals, the seamless delivery of information. ICSA Boardroom Apps, as a software company of The Chartered Governance Instiutute, suggests that any amends or additions can be remotely sent to a directors’ meeting and document collaboration app to ensure that all information is up-to-date and every participant is working from the same page. This stimulates better communication by better information sharing. It also improves efficiency as each board member is better informed and can access sensitive information in a secure, controlled environment.

Mike Evans, CEO at ICSA Boardroom Apps explains further: ‘The major advantage is being able to get papers out to members in a timely fashion. An administrator of a board will have lots of papers coming in for a particular meeting, which then need to be collated, formatted and distributed to directors in many different locations. That challenge is compounded by papers coming in late or being amended, so a set of numbers may go out that then need replacing because something has changed. Of course, boards want to achieve this in an effective way, and they want it to be fast and secure’.

The ability to make informed decisions in real time is an improvement that technology can help to achieve. Electronic distribution is generally accepted to be safer and more efficient but there are also a number of personal advantages for the board member in using a board portal. After they have securely signed in, the opportunity to navigate between different sections is helpful. The fact that they can annotate documents and then email different sections if they wish to share information are useful features. They can access these papers without being in the office or even necessarily being online, which enhances productivity and is of particular benefit for mobile directors.

Potential drawbacks

Despite the numerous benefits electronic board portals can bring to a board, these tools must be used with care. John Mills explains that although ‘It can definitely help, it can negatively impact if its speed is used to allow people to do something at the last minute or bombard people with too much information’. Another Institute member, who has also experienced the potentially negative impacts of the easy-to-update information, echoes this sentiment: ‘changing the paper after distribution … because it is easy to upload a new version … tends to make the board grumpy, particularly if they have already begun to read and annotate the readers.’

Helen Pitcher describes this downfall as a ‘test of the ability to absorb lots of information quickly and to try and vaguely make sense of it’. Therefore she believes that ‘there is a revolution waiting to happen in the board information arena, that facilitates boards to make their oversight more insightful’.

The solution to this is to choose a provider that will offer ongoing training to all its users and equip the company secretary with the information they need to ensure the right papers are fed into the portal at the right time. ICSA Boardroom Apps provided bespoke training sessions for board members and administrators, as well as 24/7 global support.

In a nutshell, a web-based portal or app can keep boards in touch with good governance. It can allow you to vote faster, annotate board meeting documents, securely access sensitive board information and efficiently prepare for meetings. Helen leaves us with a final remark: ‘The role of the company secretary in influencing, shaping and delivering this information future is there for the taking, but will require a significant set of behavioural and technical skills. Are you ready, willing and able?’