A better way to read

Mike Atkins, founder and CEO, Endexx

The transition from traditional paper-based board books to sophisticated board information management systems is definitely gaining pace, but companies need to be very careful about the sort of system they implement.

Flexibility and adaptability are key. Companies have had problems after implementing systems that, at the time, seemed cutting edge but did not allow for changes in the type and breadth of data being stored and could not adapt to new functionality. That is probably one of the most important things companies should take into account. They should ask themselves, ‘Sure this system looks good now, but can I adapt it in the future if circumstances change?’

For this reason, among others, ‘hosted’ solutions are growing in popularity. By having a third-party specialist build and manage your system, you benefit every time that provider updates their systems. You don’t have to waste time and money monitoring the latest technologies and figuring out the best way to apply them. This can lead to a problem, though. If vendors are too tech-centered, they may not understand the intricacies of the corporate governance market – so you may get a great tech tool but miss out on some areas. Striking a balance between tech savvy and familiarity with compliance is vital.

Any board book system should go beyond just being a digital version of the minutes. With all the extra information that directors are demanding these days, the system must offer more. It should form part of an executive relationship management tool where all the information or documentation a director may need is available. It is a requirement of the corporate secretary to make these available, and the board book system is the ideal tool.

But don’t get carried away. You won’t get anyone to use something they can’t understand. The system must be user-friendly. Use technology that directors are already familiar with, like the Microsoft platforms.

Gary Levine, president and founder, Two-Step Software

The three main issues for board communications these days are how to get the board books to directors, the ‘in-house versus hosting’ argument and how to deliver direct access to all the information that directors are looking for to fulfill their responsibilities.

Some younger and more entrepreneurial directors, the private equity types, are much more comfortable with the daily use of technology and are looking for the opposite of a board book, which they feel restricts them to a predefined package of information. They want to be able to access all the available data and decide for themselves what they need to be looking at to prepare for board meetings.

Giving access to this type of data via a paper board book or even some older online service is just not possible. This is one of the forces driving the move toward shared information rooms or virtual data rooms, as they are sometimes called.

Effective communication is really the key. Companies should move beyond just looking at this in terms of administering information. If done properly, this can be a great tool to allow people to communicate and improve the process of board work through allowing the right people access to the right information in a very timely fashion. Done right, a well-developed board information management tool will lead to better board operation and more effective directors.

There are still a number of companies that prefer to manage these systems in-house, but the general trend is toward external hosting. There’s a growing acceptance that security at external companies may, in fact, be superior to a company’s own system.

More filings and other key business operations are being conducted online, and this will only work to encourage people to make greater use of technology at the board level, including online board approvals and voting.

Mark Ross, CEO, 80-20 Software

There are a lot of options in structuring the most effective board information system. To this point, outsourcing the operation of the board book system has proved popular, though many companies prefer to have a third party come in and build the system and then the company manages it in-house.

One thing to keep in mind is security. This is sensitive information, and restricting access should be a priority. Of course, under the old system, where paperwork was sent through the mail, this was a serious issue. There was no real way of monitoring where everything went. The same applies to e-mail now. By having systems maintained in-house, there may be less risk of security violations. And you can still take advantage of the skills and expertise of the vendor by getting them to update the system on a regular basis.

Timely access to information is one of the most important things to board directors. It is the responsibility of the corporate secretary to make all relevant information available, but this can be a challenge if board members have responsibilities elsewhere or live overseas. The easiest way to do this is to turn the board book facility into a kind of virtual data room.

There has been some reluctance among board members to adopt interactive, online systems, but this is beginning to pass as the ease of use of these systems has improved. Other divisions of the company can also make use of a well-constructed board information facility. Being able to track who has accessed what information and when is a huge plus over the traditional process and will save a lot of time during audits or if an investigation is ever required.


Joe Ruck, president and CEO, BoardVantage

It is fair to say that the paperless boardroom is here. Going back twelve months, there were a lot of people talking about it, but now we see a significant number of people who are either at that stage or quickly moving there.

There are a number of reasons for this. One is that the market has gone through a phase of maturation, mostly driven by product availability. There is also much wider acceptance of not only the technology, but also the need for a better way to store, manage and retain board information. Directors have also become far more tech savvy. There used to be a widely held fear that directors didn’t understand technology or want it in the boardroom. This just simply isn’t the case anymore.

There is a need for a better system, as the nature of board work has changed. Directors’ duties have expanded and compliance responsibilities have multiplied. They are confronted with a much greater need for information, and at the same time there has been a massive acceleration in the pace of decision making. The old system of reviewing a board book every few months just isn’t tenable anymore. Also, with regulation regarding data retention becoming stricter, people appreciate having the ability to keep all relevant information in one place and search across any field they like to find whatever information is required.

There is definitely a trend toward outsourcing the board information management task. A few years ago, companies were very concerned about security and wanted everything in-house, but they’ve become more comfortable with the security now available at third-party vendors and the system for sending information to them


Greg Radner, SVP, corporate executive services, Thomson Financial

The number of companies looking to move their board communication function online has definitely increased in the last six months. Well over 20 percent of US companies have already adopted a system or are looking to do so. This trend is going to gain pace throughout the year and going forward.

The people involved in preparing board documentation see this as a great way to reduce workflows. An online system can cut down greatly on the amount of time spent preparing, managing and delivering board information. Board members are also demanding a better way to access information.

Many companies that have built systems themselves, or bought a one-off system from a vendor, are finding it hard to maintain the system and incorporate upgrades. Many people are starting to realize that internal hosting may not be as secure as they think because the biggest security risks are internal.

That is leading to a preference toward outside vendors hosting the system and the data. Customers benefit from automatically updating software, and most vendor companies have extremely stringent security policies. The use of innovative tools, such as security keys with codes that change every minute like those available from RSA, has greatly improved security.

It is possible to use these systems beyond the board book function. They could be used as a research facility or an educational tool for directors. Also, offering additional information that they can use in regular business, such as financial data feeds, analyst reports and news services, might give them an incentive to use the sites more often.