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5 tips for better board reporting

User AvatarPosted by James Salmon at 18/07/2019 11:21:21
content type Industry Perspective


As a finance leader, you’re intimately familiar with your company’s data and KPIs. But guess what? Most of your board members aren’t—and they don’t want or need that level of detail. What do they want? Like your CEO, board members are searching for trusted, strategic deputies who can provide high-level, holistic insight that helps them navigate the swirling currents of today’s business world.

Luckily, top finance executives have a great vantage point from which to fill this role. Here are five tips to ensure you make the most of your time at the front of the room.

Tip one: put yourself in their shoes

Who are the members? Typically, they’re not financial experts and aren’t involved with your company’s day-to-day operations. They may serve on as many as four or five other boards. Moreover, since the 2008 crash, they’ve come under increasing scrutiny and are held to ever-higher standards, even as the pace and complexity of business increases.

As you craft your presentation, keep this vantage point in mind. You don’t need to wow board members with your intricate grasp of the material; you need to give them the information they require.

Tip two: be transparent

As a finance leader, your most valuable asset to the board is your objectivity. You have no axe to grind; you’re not spinning anything; you’re certainly not making the sales forecast look rosier than it is. The most helpful thing you can do is to report bad news as soon as possible in a straightforward way. Conversely, if performance is improving, the board needs to see updated forecasts ASAP, too. Skip the impulse to leave the forecast where it is and present numbers you think the company can beat. The board is always happiest with the most updated, most honest and most objective data available.

On a higher level, transparency also relates to the crispness of the overall message you present. Delivering a message informed by a single source of truth, rather than an overwhelming ream of data, stops the debate over whose numbers are correct and refocuses the discussion on insights and action. In short, it speeds and improves decision-making.

Tip three: provide context

Board members need to quickly grasp your company’s big picture, rather than a snapshot of performance at a moment in time. You can help them get there by covering where the company has been, how it’s performing now and where it’s going in the future. In other words, consider showing them four to eight quarters of past performance, the current quarter’s numbers and four quarters of your latest forecast. That allows the board members to quickly and comprehensively understand how the company is doing.

Tip four: be consistent

Nothing annoys the board more than when your presentation’s data points change from one meeting to the next.  Winnow down the key performance indicators you choose to share the same way, every time. Say you monitor about 250 KPIs internally, ranging from sales metrics to marketing productivity, before you even get to the financial details. When you present to the board, cut the KPIs you share to about 20. Make sure you choose ones that are clearly defined and meaningful to the specific areas you’re covering.

Tip five: know your role

This can be tricky, because executives can have different perspectives on the role of a financial leader. The bottom line, though, is that you’re often the only non-board member who attends the meetings. That means it’s better to keep a low profile and refrain from debating issues, taking sides or inserting unsolicited opinions. Remember: If you do your job—reporting the financial information as objectively and accurately as possible while adding valuable context—board members are going to ask for your view anyway.

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