How to Give a Strategy Presentation to Your Board of Directors

In my new book, The CFO’s Guide to Good Corporate Governance, I start the chapter on the Board of Directors meetings as follows:

“As a former auditor, I attended countless Audit Committee and Board meetings. Some meetings were crisp, lively and energetic. Management came to the meeting prepared and ensured their Board was prepared. Issues were discussed and debated and consensuses emerged. I left these meetings feeling inspired and energized.

Most meetings I attended left me wishing I had brought something sharp with me. Materials were hot off the printer and rushed to the attendees, occasionally as the meeting was in progress. Management awkwardly talked through the PowerPoint slides while Board members checked their BlackBerrys. Rarely would the important issues get adequate time for discussion. The discussions would veer off on some tangent and half the agenda would be squeezed into the last ten minutes.”

When I wrote the above, I had not been to a Board meeting that felt like a soul draining waste of time in a number of years. I was recently reminded that what sometimes made it painful was how management elected to have a strategic discussion with the Board. 

In this example, roughly a third of the three hour agenda was allocated to the strategic discussion; the discussion ended up taking two hours. Sounds great, right? Must have been a really interesting and robust discussion, eh? Well, it was not so much a discussion as it was a “discussion”.

In advance of the meeting, management put together a really thoughtful PowerPoint presentation that went through the company’s strengths, weaknesses, opportunities and threats. It set out a number of strategic alternatives and reflected the COO’s vision for the future. The presentation was circulated to the Board roughly five days in advance of the meeting, so everyone had a chance to read it in detail before the meeting.

During the meeting, management elected to put the presentation up on a screen and then talk to each slide. Given there were forty slides, it took two hours to get through the presentation. * During the two hours, the Board probably asked a half dozen clarifying questions. Absent was any debate or any meaningful feedback from the Board. No decisions were made as a result of the presentation.

* Pro tip: it takes 3-4 minutes to talk through a slide. If you are going to speak to each slide, plan accordingly. An hour presentation translates to 15-20 slides.

When I was last in the CFO role, we had a strategic discussion at every Board meeting. We would prepare a detailed slide deck and we would send it out to the Board a week prior to the meeting. The difference to the above experience is that we did not put the slides up on the screen. We also did not talk the Board through the slides at all. We simply asked, “Any comments or questions on the materials we provided to the Board?” That simple question was always sufficient to kick off a discussion that would allow the Board the chance to challenge management and help shape the company’s strategy.

The key in my mind was the quality and clarity of the materials provided to the Board. We made sure the first couple of slides clearly indicated management’s proposed course of action. We would follow with all of the key assumptions made. The rest of the materials would detail the various alternatives available, supporting management’s recommendation.

The result is that management did not need to spend any time conveying its point of view to the Board. This led to a really good meeting where issues were fully discussed and debated. Management always left the meeting with a clear mandate from the Board.

I think that last sentence is quite important. As management, you need to have a clear authority to act from the Board. If you leave the meeting with an agreement to talk again soon, there is no clarity for management. Management will inevitably meander on without a clear focus. This is an example of poor governance that will ultimately result in sub-par performance.

To summarize, feel free to put together a really detailed set of Board materials. Do not worry if you have 60 slides for a 90 minute discussion. Put the projector away and resist the temptation to speak to every point on every slide. Make sure your recommendations are clear and focus the discussion on obtaining a clear mandate from your Board.