UK: board performance evaluation - room for improvement, according to ICSA

ICSA - the Institute of Chartered Secretaries and Administrators - will this week publish the 2008 edition of its annual board performance evaluation survey (copies can be requested here). A short overview has, however, been published in the Chartered Secretary magazine and this states:

A new ICSA survey has revealed that only 16 per cent of companies in the FTSE 200 undertake an externally-developed or managed evaluation process.  The 2008 edition of ICSA’s annual board performance evaluation survey ... has revealed that only 32 of the UK’s top 200 companies used an external provider to assist with board performance evaluation last year. ICSA is concerned that, if companies do not benchmark internally - driven processes from time to time by using an external facilitator, then evaluations could become less valuable – or, in the worst case scenario, the equivalent of children ‘marking their own homework’.  The report also argues that several companies appear not to understand the important distinction between the chief executive reviewing the performance of executive main board directors in their capacity as members of the top management team, and the ‘entirely separate task’ of evaluating the effectiveness of each of the main board executive directors. ICSA says that the two tasks are quite distinct, and should be mutually exclusive".