A Due Diligence Checklist When Searching for a Board of Director Role

When searching for a board of director role, conducting due diligence is essential to ensure that the opportunity aligns with your interests, values, and goals. Finding a board opportunity should identify the overlap in your personal life, professional career, and the company’s needs. 

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Here is a checklist of important factors to consider during your board member search due diligence process:

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• Company Information:

• Research the company's background, history, and industry.
• Understand its business model, products/services, and market position.
• Review financial statements, annual reports, and press releases to gauge the company's performance and stability.

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• Board Composition and Culture:

• Learn about the current board members, their backgrounds, and expertise.
• Assess the board's diversity in terms of demographics, geographics, skills, experience, and perspectives.
• Evaluate the board's culture and dynamics, looking for indicators of effective collaboration and constructive engagement.

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• Governance Structure and Practices:

• Review the company's corporate governance documents, such as bylaws and board charters.
• Understand the board's responsibilities, decision-making processes, and committees.
• Assess the board's adherence to governance best practices, including independence, transparency, and accountability.

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• Strategic Direction and Challenges:

• Gain insights into the company's strategic goals and priorities.
• Assess the board's involvement in setting and reviewing the strategic direction.
• Understand the challenges and risks facing the company and how the board addresses them.

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• Board Expectations and Commitment:

• Clarify the time and resource commitments expected from board members.
• Understand the board's expectations regarding attendance, participation, and contribution.
• Evaluate whether you can fulfill these expectations while balancing your other commitments.

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• Reputation and Ethics:

• Research the company's reputation, ethical standards, and corporate social responsibility practices.
• Assess the company's track record in areas such as employee relations, environmental impact, and community engagement.

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• Compensation and Liability:

• Understand the compensation structure for board members, including fees and equity.
• Review directors' and officers' (D&O) insurance coverage to protect against personal liability.
• Assess any potential conflicts of interest that may arise.

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• Legal and Regulatory Compliance:

• Ensure the company complies with applicable laws, regulations, and industry standards.
• Assess the board's oversight of compliance and risk management processes.

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• Networking and Support:

• Evaluate the potential for networking and professional development opportunities through the board role.
• Understand the support and resources available to board members, such as access to information, training, and expert advice.

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• Personal Fit:

• Reflect on whether the company's mission, values, and culture align with your own.
• Consider whether your skills, expertise, and background complement the needs of the board and the company.

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Remember that this checklist is not exhaustive, and you may have additional factors specific to your situation. It's crucial to gather as much information as possible and engage in discussions with current board members and company representatives to make an informed decision about pursuing a board of director role.

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All tBL Plus Members receive this checklist within the members-only portal also containing step-by-step action plans, educational materials, live workshops, and on-demand courses, as well as 1:1 coaching, boosted exposure to boards, and exclusive networking opportunities. 

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For other information on best practices when searching for a board of director role, we suggest:

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Watch a replay of our past event, Thriving the Boardroom: Trailblazing Women in Today’s Boardrooms, for candid guidance from 3 experienced board directors: Shellye Archambeau, Shannon Nash, and Aidan Madigan-Curtis.

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Read 5 Ways to Strategically Position Yourself for the Boardroom and 3 Steps to Effective Networking When Looking for a Board Director Role, for more guidance on the initial steps you should be taking when pursuing a board role.

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