Avoid the same Mistakes as HBOS by Improving your Minute Taking
An independent report published by the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA) looked into the failures of HBOS plc and the need for a £37 billion government bailout in 2008, and concluded that HBOS’ failures were due in part to inadequate minute taking.
In response to the report, Right Honourable Andrew Tyrie MP, Chairman of the House of Commons Treasury Select Committee, highlighted a number of points about the matter to Simon Osborne, Chief Executive of the Institute of Chartered Secretaries and Administrators (ICSA).
In his letter, Mr. Tyrie indicated that minutes taken by the HBOS Board were not ‘sufficiently full’ and as such, ‘robbed the regulators and the public of an extremely useful source of information.’ The consequences of insufficient minute taking, according to Mr. Tyrie, was that the Board of HBOS was responsible for its ‘disastrous’ business strategy.
To avoid this yourself, when taking Board minutes, it’s important to include as much detail as possible, including any opposition or challenges to points raised. This could prove useful should you need to know who said what at a later date.
Guidance on Taking Minutes
The ICSA says that good practice is always changing and they ‘have been reviewing the guidance available on minute taking to ensure that it is still up to date and relevant,’ and concluded that an update is needed.
Difficulties, of course, come from different sectors having different requirements. Some bodies require details that other bodies would not want to include, such as names of individuals and their viewpoints, in case such matters ever surface in court.
To get around this problem, the ICSA encourages members to provide insight into their own sectors, for example, financial company secretaries to provide feedback on requirements by the FCA and charity secretaries to provide the same for the Charity Commission. With this information, they can provide companies with more detailed guidance and examples of good practice. This should help you avoid mistakes similar to those of HBOS.
If you would like to help review and draft new guidance, or have any views on the issue, you can contact the ICSA here firstname.lastname@example.org
If you need assistance from us, we are available to attend meetings to take professional, detailed board meeting minutes, whichever sector you’re in. Our minutes are version-controlled, quality checked, and draft minutes are presented for your approval within five working days of the meeting. Just email us at email@example.com for more information on our minute taking service.