Boardroom Study Tools

The board sets direction, oversees performance and risk, and holds management accountable. Management delivers within delegated authority. Apply it: when does an operational exception become a board-level pattern or strategic concern?

What interests could influence the decision? What disclosure, independent input and decision process are required? How will the handling be recorded? Check the applicable jurisdiction, constitution and policy rather than assuming one rule applies everywhere.

Examine the quality of information, constructive challenge, skills, independence of thought, decisions and follow-through. Attendance alone is not enough. Apply it: what evidence shows challenge changed a decision?

Appetite concerns the type and degree of risk an organisation is willing to take in pursuing objectives. Controls influence likelihood or impact. Ask whether the residual exposure is acceptable and who checks that controls operate.

Revenue can be recognised before collection. Inventory, capital spending and debt repayments can absorb cash. Trace the difference using the cash-flow statement and working-capital movements rather than assuming profitability means liquidity.

It may indicate slower collection, but sales timing, customer mix and payment terms also matter. Compare ageing, disputes and trends. Apply it: identify evidence needed before blaming the credit-control team.

What incremental cash flows, timing, assumptions, implementation costs and downside scenarios are involved? Consider value, affordability and strategic fit separately. A positive base case does not prove the business can fund the downside.

A ratio summarises selected figures and may hide timing, definitions and one-off effects. Compare consistent periods and relevant peers, inspect the underlying numbers and explain what the ratio means for the decision.

Use evidenced strengths, weaknesses, opportunities and threats to generate options. Compare the options and choose actions, owners and measures. A list of observations without choices is not a strategy.

Test fit with objectives, capacity to execute, stakeholder implications, financial consequences and risk. Include a credible status-quo or staged option. State assumptions and what evidence would change your recommendation.

An objective describes the desired outcome. Strategy explains where to compete and how to succeed, including trade-offs. Apply it: explain the choices behind a revenue-growth target, not just the target itself.

Strategic rationale, standalone value, quality of earnings, funding, due diligence, integration capacity and downside exposure. Challenge claimed synergies and identify the conditions under which the board should walk away.

Compare stated values with incentives, promotion decisions, complaints, staff turnover, speak-up evidence and responses to failure. Ask whether management behaviour supports the culture required by the strategy.

Challenge assumptions with evidence, invite alternative explanations and separate disagreement from personal criticism. The chair should help all relevant views emerge and clarify the decision, rationale and remaining uncertainty.

Verified facts and uncertainties, immediate priorities, decision authority, communications ownership and the next review point. Test operational resilience and stakeholder impacts. Avoid confident statements unsupported by evidence.

Specify an accountable owner, milestones, resources, measures and escalation triggers. Review evidence of outcomes and unintended consequences, not simply whether a task has been marked complete.

A fictional B2B services company has grown annual revenue from £2m to £2.4m. Gross margin has fallen from 40% to 34%. DSO has risen from 42 to 61 days. Available cash is £110,000 and management expects £85,000 of net cash outflow over the next six weeks. The sales director proposes a £60,000 expansion commitment. One customer represents 28% of revenue, and several invoices are awaiting acceptance evidence.

Your task: recommend whether to approve, stage or defer the expansion. Explain the commercial opportunity, cash exposure, missing information and conditions for your recommendation. What belongs with management and what requires board oversight?

Practice timing: five minutes to identify facts, ten to compare options and five to deliver a two-minute verbal recommendation and challenge your assumptions.

A fictional company is considering acquiring a smaller competitor for £900,000. The seller reports £180,000 annual EBITDA. Management forecasts £80,000 annual cost savings. The largest customer supplies 35% of the target’s revenue and may review its contract in six months. The founder plans to leave after three months. Customer information is held across several systems, and the buyer’s leadership team is already delivering a major internal project. The chair wants a decision within seven days.

Your task: compare immediate acquisition, conditional progression and walking away. What evidence would justify moving forward? Identify financial, strategic, governance and people questions, plus the conditions under which you would stop.