What is an Executive Session? And Who Belongs at the Table?

Board members in executive session (or Maxwell Smart and his boss under the “cone of silence.”)

Perhaps this is a faulty premise to start with but go with me. You’re on a board of a nonprofit. The fiduciary buck stops with you. You are going to raise money, provide strategic oversight, and provide financial stewardship. I would conclude that you are, by virtue of all these things, a grownup.

And then there are stories like this.

It’s an executive session and talking about the CEO review. The CEO is not present. A board member makes some negative comments about performance. The board member is asked if he made those clear on his CEO evaluation. Answer? “No, I was afraid the CEO would recognize my handwriting.”

I’m right. Faulty premise, eh?

So why have an executive session at a board meeting and does the CEO always sit outside in the dark (even when it is light out)?

WHAT IS AN EXECUTIVE SESSION FOR ANYWAY?

Before I answer that I must confess that, with the exception of an annual review discussion (the one above that involved the possibility of handwriting analysis), I have never participated in an executive session in which a single bit of conversation could have or should have happened without the CEO present.

What the heck are they for anyway? Boards mistakenly think that it is an opportunity to raise concerns about the CEO or some senior staff person in a ‘safe’ space. Or that they just must have one at every board meeting and there’s no real agenda and it devolves into a dish session. These same boards lift the cone of silence, call the CEO back in, and say not word one about the conversation that has been had.

So much for building a partnership rooted in trust at that organization.

Here’s why you need them. Board Source clinically offers the following rationale: (1) they assure confidentiality, (2) they create a mechanism for board independence and oversight, and (3) they enhance relationships among board members and with the chief executive. OK, so let’s set (3) aside as this refers to executive sessions WITH the CEO and let’s set aside (1) because as mentioned earlier, you just need one big baby on your board (and there is always one) and the CEO will get a full debrief anyway. So you are left with “to create a mechanism for board independence and oversight.”

OK, then so, as they say on Project Runway, when is the CEO in?  And when is she out?

TIPS FOR BOARD MEMBERS ABOUT SESSIONS WITHOUT THE CEO

You want to know when you exclude the CEO? Here’s the list:

  • The annual audit
  • Annual performance review of the CEO
  • Discussion of CEO compensation
  • Legal issues regarding the CEO
  • Board practices, behavior, performance issues

That’s about it.

But even if you’re dealing with one of the above, absolutely make sure you do the following:

  • In planning the meeting, share with your CEO the agenda for that session
  • After the CEO returns, update the CEO on the nature of the discussions.

TIPS FOR CEO’S WHEN YOUR BOARD IS IN THE CONE OF SILENCE

  • You have a right to know what the agenda is for any executive session in which you will be excluded
  • In the spirit of partnership and teamwork, you should be provided with a summary of the nature of the discussion.
  • Try to be a grownup. Assume that the executive session is running smoothly and that the discussion is in the best interest of the organization.
  • Don’t push the big baby on the board to tell you exactly what happened.  That means you’re a big baby too.

EXECUTIVE SESSIONS ARE WILDLY MISUSED

Time and again I hear that they become useless bitch sessions about staff and nothing actionable or productive comes from them.  Worse still, the CEO sits outside, assumes that it is a bitch session and wonders what nasty things are being said that he / she is not being given the opportunity to defend or address.

Used judiciously, executive sessions are an important tool in board governance.  Otherwise, ask yourself every time you open your mouth in an executive session:  “Why couldn’t I just say this when the CEO is here?  And shouldn’t she just hear this directly from me?”  If you don’t have a good answer to this question, then you’re just being a big baby.