First, review all of the company's major financial documents, such as annual and quarterly reports filed with the Securities and Exchange Commission. Should you join the board, these documents will bear your signature vouching for them. Then read the company's proxy statement, which details board activities, how directors participate and what they are paid. You may also want to talk to the company's external auditor to get a feel for how the board conducts itself and manages finances, Goodspeed says. Also read through any pending lawsuits. "You want to know you're joining a credible board," she says.
Yazdi suggests interviewing existing directors to assess fit—culture, style and ethics. Ask directors to respond to different scenarios, she advises. "Find out: Is it a cutthroat board? A very disciplined board? One that values diversity? Are they good listeners?"
Finally, be prepared for continuous learning, Goodspeed says. "Learn all you can all the time regarding the company and the environment they live in," she says. "You owe it to the company and shareholders."
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