The modern age of information technology has radically changed the old business rules. It is due to the simplification of many processes due to their automation. So, what are the pros and cons of online board meetings?
Digitization of collegial governing bodies
It is only possible to talk about a fundamental digital transformation when modern technologies are used not to solve individual problems, but to change the whole way a company operates, to radically change business processes, including those related to the management of the company itself. Therefore, the intricacies of using online technologies are of great importance when it comes not just to meetings but the work of formal collegiate management bodies: the board of directors, the management board, various committees of the board of directors, intra-corporate legally significant meetings. Such meetings have two characteristic features:
- much higher than for a regular meeting, the requirements for procedural issues: quorum, agenda, minutes, etc.;
- the price of participants’ time is extremely high, especially when it comes to the highest collegiate management bodies: the board of directors.
For online support of collegial governing bodies, in addition to the usual technical and managerial issues of organizing online meetings, the following points have to be additionally addressed:
- legal validity of online participation in terms of quorum;
- security of communication channels, elimination of the possibility of unwanted information leakage;
- convenience and visibility of collective work with the texts of draft decisions, which are the main result of the work of the collegial body.
- The benefits of the online format for the boards
Conduction of board meetings in the online formal has the following valuable advantages:
- Saving cost. The introduction of a transparent system of information meetings using online tools can reduce by 10-15% the time spent by employees on performing current functions. The need to constantly explain what has already been explained and correct errors already predetermined by introducing a new regulation that is not understood correctly by employees is sharply reduced. Thanks to the introduction of online technologies in the work of collegiate bodies, it is possible to reduce the non-productive time of key managers on travel by about half and reduce travel expenses by about the same.
- Better risk management. Approximately the same 10-15% reduces legal, financial, and organizational risks associated with employee errors due to misunderstanding or lack of necessary information.
- Transparency of business processes. A significant additional benefit that can be derived from online technologies for corporate governance is the higher information transparency of the company. A joint-stock company striving for high standards of transparency and understandability for investors can increase this transparency with such a simple and obvious step as online broadcasting of the general meeting of shareholders and other significant information events. If at the same time, we do not limit ourselves to broadcasting and allow shareholders to provide feedback, then the information contact will be even higher.
- Automating document management. Board members can secure chare confidential documents through the system for online meetings like board software. The board portal fully automates the holding meetings of collegiate management bodies, with the possibility of agreeing on the agenda, voting, signing, and subsequent control over the execution of instructions. The results of voting on agenda items are posted in the information system within an hour from when such voting ended. At the same time, the decisions are formed automatically in the form of a protocol. The system itself counts the votes, so manipulation is out of the question.