The delegate list for Family Business UK’s annual conference is unlike any other. At their 2024 conference, “Harnessing the power of people”, I found myself chatting with the MD of a chain of funeral homes one minute and the chair of a multinational engineering company the next, while appreciating the diverse and multi-generational nature of the UK’s family business community.
We were there to talk about board effectiveness. Sharing insights from our research and client work, we were exploring what business leaders could do to get even more value from their board — and the vital role of focused agendas and high-impact board reporting.
This being the biggest annual gathering of family businesses in the UK, we couldn’t resist doing a little extra research. Having spent the past five years gathering data on board reporting with our board pack assessment tool (developed in partnership with the Chartered Governance Institute UK & Ireland), we wanted to find out how the 250+ family businesses in the room saw the quality of their board reporting and whether it differed from other companies. The results were marked.
Family business leaders are much more satisfied with their board papers: seven in ten said they helped them have more focused and productive conversations, whereas fewer than three in ten of the wider population held this view. Family business directors were also less likely to say that the content of their board papers is too operational (34% vs 69%) or too internally focused (24% vs 61%).
But this doesn’t mean family businesses have board reporting nailed. A substantial minority (40%) thought their board papers were too backwards-looking, and 45% compared finding the key messages to searching for needles in a haystack. Overall, nearly half (44%) of directors surveyed said their board papers were in need of improvement.
Why are family business directors happier with their board packs than everyone else?
We have a couple of hypotheses.
It could be that family business directors know their businesses better than other directors. If you’ve held operational roles or been shareholders your entire lives, or if you yourself founded the business, you may be less reliant on the board packs for information than traditional directors who might only engage with a business for a few days every quarter. Family business leaders may be able to tap into a wider range of formal and informal channels to gather the information they need, and they may find it easier to navigate the data and identify which insights to act on.
It could also be that family businesses are more likely to appreciate the importance of paying attention to things like board and management reporting, due to the complex dynamics of holding a company together across multiple generations and families.
In mature family businesses, for example, it’s not uncommon for family constitutions to clearly delineate the roles of family member, owner, board director, and management, or to have a family council alongside an owners’ board and a supervisory board.
Some family members may sit in all four camps, with others only in the first two, but they recognise the need to codify what is required from their board papers to keep everyone informed and aligned, and they invest in their ability to deliver it consistently.
Of course, that isn’t everyone’s experience; in many family businesses, these lines blur. Paying attention to governance also doesn’t prevent it from being dysfunctional, which may explain why so many of the leaders we surveyed felt their reporting could be improved.
How can family businesses improve their board packs?
Good board packs aren’t just an issue for the board. They shape the analysis, decisions, and actions that determine whether a business survives, thrives or flounders, surfacing critical issues and giving leaders the tools to do something about them.
And when board packs are overly long, hard to read, and focused on the wrong things, even the best directors with the best intentions can get bogged down in the details rather than focusing on the big picture. The end result: opportunities get missed, threats get ignored, and progress gets stalled. In family businesses, which need to think long-term, this can be particularly costly.
So, what does good look like? We’ve spent 20 years studying what makes a great set of board papers, across private companies, listed businesses, and non-profits, and we’ve found that, in every one of these environments, it comes down to three things: best practice board papers are stacked with critical thinking that is communicated effectively and ruthlessly focused on what matters.
- A good paper starts by framing what it’s about — why it was written, how it connects to the company’s wider purpose and strategy, and what it’s asking of its readers.
- It’s then structured rigorously, tackling the tough questions head-on and at each stage asking “Why?”, “So what?”, and “Now what?” to ensure the writer leaves no stone unturned in search of insight.
- And it’s written in a way that is concise and compelling, making it easy for directors to read and digest so they can draw out and act on the key messages.
These are not necessarily skills that report-writing executives have been trained in, in family businesses or otherwise. And even when training is offered, it only gets you so far.
That’s why we built our AI-powered board and management reporting software, Lucia — to make high-quality board reporting an effortless discipline and something that management can deliver consistently. Lucia acts as a critical friend and editor to management, helping them to sharpen their focus, critical thinking, and communication skills every time they write a report for the board.
Starting with customisable templates built around our tried-and-tested QDI Frameworks, Lucia guides you to write clearly, nudges you when you get too descriptive or detailed, and points out the things you have left out. The result is a platform for good thinking at the highest level of your business — and board papers that help your board add more value.
