Practice of a Modern Board of Directors

Training format:

• interactive discussions;
• case analysis;
• board simulations;

Who the program is for

The program is designed for:

• members of boards of directors;
• independent directors;
• members of supervisory boards;
• top managers;
• corporate secretaries;
• heads of internal audit, risk management and compliance services;
• shareholders and state representatives.

About the program

A modern board of directors makes decisions in conditions of:

• accelerating change;
• high uncertainty;
• information overload;
• growing pressure from shareholders, the state, markets and society;
• digital transformation and the development of artificial intelligence.

At the same time, the board of directors does not operate in a daily operational mode, but through periodic decision-making points, with limited time and limited information.

The program focuses on practical aspects of the work of a modern board of directors:

• strategic management;
• decision quality;
• conflicts of interest;
• crises;
• audit, risks and internal control;
• the work of board committees;
• analysis of financial statements;

Program feature

The program is not built as an academic course on corporate governance, but as a practical boardroom workshop based on:

• real-life situations;
• strategic dilemmas;
• case studies;
• simulations of board meetings;
• analysis of mistakes and the consequences of decisions.

Participants will work with materials as close as possible to the real practice of boards of directors.

Key idea of the program

«There is no observation period in the board of directors. Responsibility starts earlier than the feeling of confidence appears».

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«A board member has the right not to know something. But they do not have the right to vote without first trying to understand».

Approach feature

The program is built on a combination of:

• international approaches of the Institute of Directors (UK);
• corporate governance practice in Kazakhstan;
• real cases from board of directors work;
• modern approaches to strategic management;

Key topics of the program

The board of directors as a strategic management body:

• the role of the board of directors in the corporate governance system;
• strategic management vs operational management;
• situational awareness of the board of directors;
• the link between strategy, organizational structure and the management system;
• strategic mistakes of boards of directors;
• monitoring the implementation of the strategy;
• how the board of directors loses touch with the real dynamics of the business.

Related party transactions and fiduciary responsibility:

• related party transactions (related party transactions);
• duty of care and fiduciary responsibility;
• conflicts of interest;
• pressure from shareholders and management;
• protecting the interests of the company and shareholders;
• red flags when reviewing transactions;
• personal liability of board members.

Board committees:

• the role of committees in the corporate governance system;
• audit committee;
• strategy committee;
• nominations and remuneration committee;
• how committees help the board of directors maintain control;
• typical committee operating mistakes;
• committee limitations and the risk of a «false sense of security».

Audit, risks and financial reporting:

• analysis of financial statements at the board of directors level;
• the role of external and internal audit;
• Risk management and internal control;
• key questions to financial reporting;
• liquidity risks and the company’s going concern;
• red flags in reporting and the company’s activities.

Information overload and decision-making

• useful information vs information noise (signal vs. noise);
• how to identify weak signals;
• how management forms an information picture for the board of directors;
• decision-making under limited information;
• decision quality;
• how the board of directors should not lose control over the company.

Practical cases of the program

As part of the course, participants will analyze:

• related party transactions;
• liquidity crises;
• mistakes in making investment decisions;
• conflicts of interest;
• mistakes in strategic management;
• the gap between strategy and organizational structure;
• mistakes in analyzing financial statements;
• crisis situations and the responsibility of the board of directors;
• the work of board committees in crisis and conflict situations.

Opening Case of the program

The program starts with a simulation of the first meeting of the Board of Directors.

Participants receive:

• the meeting agenda;
• materials on the related-party transaction;
• limited time for analysis;
• the need to make a decision and vote.

After the voting, an analysis of the consequences of the decisions made is conducted:

• their impact on the company’s financial stability;
• conflicts of interest;
• errors in risk assessment;
• insufficient due diligence;
• strategic and reputational consequences;
• the quality of the Board of Directors’ and committees’ work.

The case shows:

• how quickly a board member’s responsibility arises;
• how easy it is to miss critical risks;
• why you cannot vote formally without understanding the issue;
• how management forms an information picture for the Board of Directors.