The untold costs of bad board meetings

A poorly run board meeting is more than just an inconvenience; it’s a significant drain on resources, energy — and opportunity. 

The stakes are highest here. Board meetings aren’t just about ticking boxes and moving routinely through an agenda, they’re pivotal to the strategic direction and governance of an organisation. 

When conducted effectively , these meetings ensure that all members are aligned, informed, and ready to make crucial decisions that drive the company forward. But when board meetings are mismanaged, the costs — both tangible and intangible — can be staggering. 

In this article, we explore the costs of bad board meetings — and provide practical steps to help leaders drive their board meetings towards success, rather than failure. 

What are the symptoms of bad board meetings? 

Before you can start addressing the problem of bad board meetings, you need to first understand whether they’re prevalent in the mandates you hold. Diagnosing the problem of bad board meetings should be relatively straightforward — here are three key symptoms to look out for: 

1. A lack of preparation

One of the primary symptoms of a bad board meeting is poor preparation. When members arrive unprepared, it leads to significant time wastage. Instead of diving into substantive discussions, the meeting is bogged down by basic questions and clarifications that should’ve been asked before the meeting began. 

According to Dr. Shilpa Thapar, board meeting specialist and seasoned Corporate Secretary, “Directors are often not well prepared [for board meetings]. Most of them don’t read agendas before attending meetings and even do not carry agendas with them to the board meetings, which creates disorder in the meeting for arranging additional copies of agendas for them.” 

This lack of preparation not only hampers productivity but also undermines the quality of decision-making. Decisions made in such an environment are often reactive rather than strategic, as the board is not fully equipped with the necessary information and insights to make informed choices. 

2. Ineffective agenda management

Another common issue is ineffective agenda management. An unfocused or overloaded agenda can derail a meeting's purpose. Without a clear and prioritised agenda, discussions can meander, critical issues may be overlooked, and the meeting can end without achieving its intended objectives. 

Dr. Thapar confirms this, reflecting, “Agendas are often not prepared well and at times are too long to focus. Even in certain cases, it is observed that all agenda points of the last board meeting are carried forward and even the date is also not changed.” 

She builds upon this, commenting, “Agenda points are not discussed in a time-bound manner. Single agenda point consumes the duration of the entire board meeting and directors lose focus on other agenda points.” 

This lack of structure leads to frustration among board members and diminishes their engagement. When board members feel that their time is not being utilised effectively, their commitment to future meetings can wane, further exacerbating the problem.

3. Suboptimal communication

Communication is the backbone of any successful meeting, yet it is often where many board meetings fall short. 

Miscommunication can lead to misunderstandings and conflicts, which not only waste time but can also erode trust among board members. Common communication pitfalls include ambiguous language, lack of active listening, and the failure to address conflicts constructively. These issues can create a toxic atmosphere where collaboration is stifled, and critical perspectives are not fully heard or considered.

What are the direct costs of bad board meetings? 

Now that we’re clear on what to look out for, let’s consider what bad board meetings are costing your organisation — in the most direct sense: 

1. Wasted time

The most immediate and apparent cost of a bad board meeting is wasted time. Consider a board with ten members, each earning an average hourly rate of £200. If a meeting runs an hour over its scheduled time, that’s an immediate cost of £2,000 in wasted time. Over the course of a year, if this happens regularly, the financial implications become significant. 

Moreover, the opportunity cost of this wasted time — time that could have been spent on strategic planning, stakeholder engagement, or other critical activities — further exacerbates the problem. 

2. Delayed decision-making

Bad board meetings often lead to delayed decision-making, which can stymie organisational progress and competitiveness. In a fast-paced business environment, delays can mean missed market opportunities, slower response times to competitive threats, and the inability to capitalise on emerging trends. 

For example, consider a tech company that misses a critical product launch window due to prolonged indecision at the board level. The financial impact of such a delay can be severe, including lost revenue, diminished market share, and a weakened competitive position. 

3. Resource misallocation

Inefficiencies in board meetings also lead to resource misallocation. When meetings fail to address key issues effectively, resources are often diverted to address the resulting problems. For instance, if a board fails to provide clear strategic direction, different departments may pursue conflicting priorities, leading to inefficiencies and duplicated efforts. 

What’s more, the need to hold follow-up meetings or conduct additional reviews to rectify initial shortcomings consumes further resources. This misallocation impacts other critical areas of the organisation, such as innovation, customer service, and operational efficiency, ultimately harming overall performance and growth.

What are the indirect costs of bad board meetings? 

While the direct costs are significant, the indirect costs of bad board meetings are perhaps more pernicious — and troubling. These range from interpersonal costs, such as decreased trust and engagement, to more abstract costs such as reputational damage and missed opportunities. Let’s consider these individually: 

1. Decreased board engagement

Ineffective meetings often result in decreased board engagement. When board members feel their time is not being used productively, their enthusiasm and commitment can wane. This disengagement can lead to a lack of participation in discussions, reduced accountability, and ultimately, poorer decision-making. Over time, disengaged board members may attend fewer meetings, or in the worst cases, resign, leading to a loss of valuable expertise and continuity within the board.

2. Erosion of trust

Trust is the cornerstone of any effective board. However, poorly managed meetings can erode this trust. Miscommunication, lack of preparation, and unfocused agendas can create an environment of frustration and suspicion. When board members do not trust each other or the process, collaboration suffers. This erosion of trust can extend beyond the boardroom, affecting relationships with senior management and other stakeholders, ultimately compromising the organisation's governance and operational effectiveness.

3. Reputational damage

The long-term consequences of bad board meetings can also include reputational damage. Organisations known for inefficient or dysfunctional boards may struggle to attract top talent and investment. In severe cases, governance failures may lead to public scandals or regulatory scrutiny, damaging the organisation's reputation. For example, a high-profile corporate governance failure can attract negative media attention, impacting customer trust and shareholder confidence. This reputational damage can be difficult to repair and may have lasting effects on the organisation's market position and valuation.

Best practices for effective board meetings

If you’ve read this far, then you’re probably feeling worried about the state of your board meetings. But, fear not! There are a number of practical steps you can take (and behaviours you can modify) in order to slash the costs of ineffective board meetings. These include:  

Clear and focused agendas

A clear and focused agenda is essential for a successful board meeting. It ensures that all members understand the meeting's objectives and can prepare accordingly. Agendas should prioritise critical issues and allocate appropriate time for each topic. By setting a clear structure, the board can stay on track and ensure that all important matters are addressed efficiently.

Preparation and distribution of materials

Effective board meetings require thorough preparation. Meeting materials should be distributed well in advance, giving board members sufficient time to review and prepare. 

Matt Blumberg, CEO of Bolster and serial entrepreneur, comments, “When you're preparing materials for a board meeting, there shouldn't be anything that you're holding back and you should be organised enough in the way you report on things that have happened in the past that it's easy for a board member to read and prepare for a meeting and do their homework.” 

Kim Smith, Chief Capital Formation Officer at Techstars, takes an even more radical approach. She explains, “If I don't get [meeting materials], whether it's slide decks, words, whatever it is, 48 hours before I have board meetings, I will not attend. I will cancel the meeting. I will not waste my time and other people's time.” 

This ensures that discussions are informed and productive, allowing the board to make well-considered decisions. Providing comprehensive and relevant materials can also help prevent unnecessary questions and clarifications during the meeting, saving valuable time.

Effective facilitation

The role of the chairperson is crucial in steering productive board meetings. Brad Feld, Co-founder of Foundry, explains, “A skilled chairperson can manage time effectively, keep discussions on track, and ensure that all members have the opportunity to contribute.” He continues, “Techniques such as summarising key points, redirecting off-topic discussions, and encouraging participation can enhance meeting effectiveness."

An effective facilitator can also address conflicts constructively, ensuring that disagreements are resolved and do not hinder the board's progress.

Leveraging technology

Utilising technology, such as board meeting management software , can significantly enhance meeting efficiency. These tools can streamline agenda setting, document distribution, and communication, ensuring that all members have access to the necessary information and resources.

Features such as real-time collaboration, secure document storage, and automated reminders can further improve meeting preparation and execution. By leveraging technology, boards can reduce administrative burdens and focus on strategic discussions and decision-making.

Bad board meetings: Continue at your own risk 

The high costs of bad board meetings extend beyond immediate financial implications to include decreased engagement, eroded trust, and potential reputational damage. They can wreak havoc in the way an organisation functions, and become a real threat to prosperity. 

However, by recognising the symptoms of bad meetings and implementing best practices, organisations can enhance their board's effectiveness and ensure that meetings drive strategic success. 

If you would like to learn how Sherpany helps put an end to bad board meetings, book a free demo today and speak with one of our board meeting experts. 

Robert Mitson

About the author

Robert is passionate about shaping and communicating value, and in his work as English Content Specialist he creates insight to help leaders across Europe to make every meeting count.