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Prof. Dr. Rolf Watter
Partner, Bär & Karrer

The ideal annual meeting plan for the Board of Directors

 

Sherpany: Professor Watter, why does the Board of Directors need a meeting plan?

Rolf Watter: The meeting plan published in the Sherpany Board Brainery aims to ensure that none of the Board of Directors’ key tasks are overlooked or forgotten in the annual plan, and that these tasks are addressed in a logical and consistent order. In other words, the plan is a type of checklist and should be adapted to the specific requirements of the company in question.

Sherpany: What is the legal position (in terms of the non-transferable and irrevocable duties of the Board of Directors and the requirements for holding the general meeting): is the annual meeting plan subject to any legal requirements in terms of the number of meetings and/or compulsory agenda items?

Rolf Watter: There are no binding rules. The minimum number of meetings is generally considered to be four. This number is also recommended by governance codes and stipulated by some D&O insurance providers.

Sherpany: What role do the articles of association and the organisational regulations play?

Rolf Watter: Articles of association almost never contain any specific requirements. Organisational regulations often state a minimum number of meetings (usually four for medium-sized and larger companies) with the instruction that further meetings may be convened if necessary or in urgent cases.

Sherpany: What do the annual meeting plan and the meeting agendas depend on if not the law (e.g. size, complexity, current situation)?

Rolf Watter: Ultimately, the aim should be to do whatever is best for the company and its stakeholders. Having too many meetings is not usually beneficial, as it ties up resources required for preparation and attendance. If too few meetings are held, the Board of Directors will not be able to fulfil its duties properly.

Sherpany: What influence, if any, does the industry in which the company operates have on the annual meeting plan?

Rolf Watter: I think the meeting plan published in the Board Brainery is generally applicable to all industries. However, it does have to be supplemented with industry-specific agenda items. The Board of Directors should also establish priorities and be briefed on specific problem areas at meetings, for example finding out more about the business and management.

Sherpany: How can companies determine the most suitable meeting frequency for their requirements? What should they bear in mind during planning?

Rolf Watter: I think the frequency is more or less set by the plan. The actual meeting dates would, of course, depend on the specific circumstances, such as how quickly the finance department can produce the accounts or, in the case of large agendas, when the management could be given sufficient time to prepare. For example, it makes little sense to schedule the meetings in a way that would make the preparations clash with important exhibitions or customer events. If a company’s business is seasonal, the meetings should be scheduled for periods when things are less hectic on the sales front.

Sherpany: How far in advance should the dates of ordinary meetings be set?

Rolf Watter: In my experience, the dates should be fixed more than a year in advance, so that all Board Members can keep the dates free in their diaries and there are no clashes with other mandates.

Sherpany: You suggest a fixed frequency for the routine agenda items. What does this depend on?

Rolf Watter: This frequency merely aims to ensure that the most important issues are dealt with. Further meetings may be needed depending on the situation at hand.

Sherpany: Some authors now differentiate between different types of boards based on their role within the company, e.g. supporting boards – actively involved boards – supervisory boards. Do you think this would have an influence on the frequency of the meetings and the routine agenda items?

Rolf Watter: Actually, no. The meeting plan aims to ensure that all members offer input for the most important agenda items. For example, it is clear that the Chairman will be in close contact with the management between meetings – specialised members may also be involved between the meetings. As a whole, however, the Board of Directors should operate as a committee.

Sherpany: How are the meetings of the committees taken into account in this plan? Do you recommend a plan for these as well? How is the input of the committee meetings combined with that of the Board as a whole?

Rolf Watter: Personally, I have found that it is best to hold committee meetings the day before the general meetings. This facilitates planning and reduces travel time. It also provides an opportunity to have dinner together the night before the meetings, which aids social cohesion among the members and enables problems to be discussed in detail outside the rigid structure of the meeting plan.

Sherpany: Thank you for taking part in the interview, Professor Watter.

Prof. Dr. Rolf Watter
Partner, Bär & Karrer
Prof. Dr. Rolf Watter is partner at Bär & Karrer, a renowned Swiss law firm in Zurich, Geneva, Lugano and Zug. He is one of the most influential Swiss lawyers, with a broad experience in all types of M&A transactions, including defence mandates, and corporate governance topics. He was awarded a Masters in Law (LL.M.) from Georgetown University, Washington D.C. and a Doctorate in Law (Dr. iur.) from University of Zurich. Since 1996, he is part-time Professor of Law at the University of Zurich. Presently, Prof. Dr. Rolf Watter is Chairman of PostFinance AG, Vice-Chairman of AP Alternative Portfolio AG and Board Member of Faber Castell (Holding) AG. His previous Board experience includes mandates at companies like Nobel Biocare (Chairman), Zurich Insurance Group, Syngenta, Centerpulse and Forbo.
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