There are certain aspects of business life that most people have only heard of. Such is the case of the board meeting. You know that companies hold board meetings, you understand they talk about “very important business stuff,” but other than that it is sort of a mysterious get together of important individuals in the company. These meetings are not just random get togethers of higher-ups in the company, they are actually important parts of running the company, and they follow a rigid structure.
In order to understand the importance of these meetings, it is important to know who would be attending the meetings. There are usually only a few members that should be at each meeting making up the board of directors. They are the Chairman of the Board, the Vice Chair, the Secretary, and the Treasurer. These positions are almost always filled with officers of the company, such as the CEO, COO, or CFO. Shareholders who have a large stake in the company may also be included on the board.
The meetings often take place once per month, or once per quarter. The members will convene, and follow a strict meeting agenda. This meeting usually starts out with a reading of the minutes from the last meeting. The minutes of the meeting are taken by the secretary, and often, rather than use meeting time, they are simply emailed to those who attend. After a quick vote to agree that the minutes accurately reflect the previous meeting, the board moves on to discussing the treasury report. When the financials are out of the way, new items of business can be discussed. Anything that is going on with the company that is important to its future will be discussed and a vote will be held.
A board meeting can take place almost anyplace. Most large companies will have a board room where they will hold them. I have a friend who runs a small business and they have their monthly meetings at a local restaurant in a private room. Another option would be to rent out space. Here in Denver you have hotels such as the Hyatt Regency that have board meeting rooms available. Boardroom meeting venues in Hong Kong can be customized based on your specific needs such as needing video projection or wanting to add refreshments.Board meetings have an agenda they must follow and seem like a lot of work. So why do companies have them? In order to be a corporation, they must have them to keep their tax status. In the case of a publicly traded company, the minutes need to be made available to all stockholders, and certain key issues require the vote of all shareholders. In short, the bylaws of the company require these meetings and in order to maintain their corporation status the meeting minutes need to be recorded and filed (in order to have minutes, a meeting must have occurred).
Board meetings seem like a place where a lot of mysterious things happen. But really, they are just there to keep everyone in the loop with what is going on with the company. These meetings are where important issues are determined and voted on. Such as when Facebook decided to go public, this issue was decided during a board meeting (actually, probably during many board meetings). Want a one sentence summary?