Induction refers to the process of onboarding a new director onto the board. The objective of the induction programme is to provide the newly appointed director with all the information that he/she needs to be effective in the role and contribute to the sustainable long-term success of the organisation on which he/she serves. The quality of board induction programmes varies widely, with many boards failing to provide an effective induction that maximises the contribution of the newly appointed directors in the shortest practicable time.

In a series of 2 articles, NEDonBoard provides guidance to boards to establish an effective board induction and onboarding for their newly appointed directors or trustees. This blog focuses on the components of an effective board director or trustee onboarding. The second blog presents the attributes of effective board inductions and discusses the best practices.

A well-designed induction programme provides new directors with information about their roles and set the expectations.

Standard pack of information

It is recommended to include a standard park of information, which will include the following items:

Article of association
Corporate structure and organisational chart showing subsidiaries and listing the names of individuals in charge
Last 3 annual reports
Minutes of last AGMs or any shareholder meetings in the last 2 or 3 years
Agendas, board papers and minutes of the past year’s board meetings. Depending on the responsibility of the newly appointed director, you may include agendas, board papers and minutes of the sub-committees of the board
Terms of reference of the board and its sub-committees
Job/role description (i.e. brief on the role expectations and obligations of a board member)
CVs, executive biographies, and contact details of all board directors
The performance evaluation of the CEO and other directors
The most recent board effectiveness evaluation, together with the action list
Strategic plan and budget
Most recent competitor analysis
Overview of industry specific legislations and regulations
Key policy and procedure documents e.g. code of conduct, risk appetite statement
Key insurance policies, including Directors & Officers insurance (if it has not been showed prior to the letter of appointment being signed)

Not all the above will be relevant to your organisation. The list is not exhaustive either and should be complemented with additional documents as necessary given the specificities of the organisation. For example, details on subsidiaries and their governance structure, financial reporting standards, responsibilities of directors and senior leaders in specific jurisdictions, applicable regulations, etc.

Schedule of meetings

Newly appointed directors will benefit from having a schedule of meetings with each of the CEO’s direct reports, the CEO, the Company Secretary, and the other directors. The chair of the board should devote time to onboard the new director and explain how the board operates.

The schedule should also include:

Site visits: organisation sites, as well as client and supplier sites, if this is relevant
A session with the external auditors
A session with the internal auditors

Each director, together with the Chair or the Company Secretary or the Head of Learning & Development (typically in charge of the onboarding programme) must also assess the relevance of attending a course in governance or other relevant training. NEDonBoard designed the Modern Board Member Masterclass for newly appointed directors. The course covers important governance aspects of the board member role and focuses on modern and contemporary boardroom topics such as ESG and digital transformation.

The induction should be complemented with regular sessions with the Chair and Company Secretary so that the information pack and other findings can be discussed. It is important for the board to listen to the insights that a fresh pair of eyes can provide. The induction is a two-way process in which the board and the new director can learn.

Related post: Board refreshment and succession planning

If you are an organisation looking to improve the board onboarding process and require further guidance, please contact [email protected]. We encourage you access the Modern Board Member Masterclass course brochure. Specifically designed for newly appointed board directors, or those looking to refresh their knowledge and skills, the Masterclass complements company specific onboarding programmes. NEDonBoard has already successfully trained newly appointed directors and maximised their contribution.

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