Service to assess how boards perform

A NEW service has been launched to better evaluate the performance of Irish businesses — in terms of company boards, individual directors and board committees.

The Board Performance Evaluation Service, from the Institute of Directors (IoD) — which will cover publicly quoted companies, SMEs, state and semi-state companies and regulated financial institutions — is aimed at improving effectiveness and performance at management level.

“Undergoing a board evaluation makes sound business sense, with more and more businesses throughout Ireland now recognising that evaluating the performance of their board is a powerful investment in the future of their organisation. And increasingly, boards are asking for an external, experienced assessor to conduct such evaluations, so as to ensure transparency and independence,” according to IoD Ireland chief executive, Maura Quinn.

She said: “In the current climate businesses want to ensure that their board is delivering real value and performing at an optimal level to drive shareholder value.

“There is also a need to be able to provide assurances to stakeholders and potential investors that their organisation is committed to the highest standards of governance and probity, particularly in light of governance failings which have emerged in recent times.”

“A board evaluation, carried out by an experienced external assessor, is the ideal way to identify how the board can be strengthened and improved,” said Ms Quinn.

The service assesses and evaluates company performance in the key areas of strategy, business principles, risk management and internal control, performance and measurement, stakeholder management, board composition and boardroom practice.

While not mandatory and the use of the service will cost companies money (dependent on the range of services they use), the IoD said that it established the service in response to a definite demand from the Irish business community.