New audit committee members can deepen their knowledge of the company through one‑on‑one discussions with key business leaders.
Regardless of whether it is part of a formal or structured orientation process, a new AC member will want to have one-on-one discussions with a number of key leaders of the business to gain a better understanding of the company—the culture, strategy, key risks, strengths, areas of concern, etc.—and to get to know the leaders outside of the formality of the boardroom.
Initially, it may be helpful to get the “lay of the land” by meeting separately with the general counsel and the CAE, each of whom can be valuable sources of information and insight. What are the hot-button issues facing the company? What issues have management and the board been spending the most time on? What governance processes work well, or not so well? What is the culture of the company and of the board?
The general counsel can provide information about the board from a legal and process point of view, including the committee structure, the role of each committee, and how the committees coordinate and communicate about oversight activities. The general counsel can also provide an update on litigation or investigations that could have an impact on the company’s financial statements, disclosures, and legal/regulatory compliance.
With IA increasingly playing a larger role in many businesses, the CAE should also have important insights to offer regarding the effectiveness of the organization’s risk management processes, system of internal control, and governance processes. In addition, a new AC member will expect to hear from the CAE regarding:
In the weeks and months following the initial orientation session, a new AC member may also want to meet one-on-one with other leaders in the business—CEO, CFO, CRO (or equivalent), AC chair, lead director, chief information officer (CIO)—to get their views on a number of key company-wide issues, including:
Business leaders can also offer important insights on issues specific to their areas of focus and responsibility. See Potential Discussion Topics for other possible issues to explore.
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