2012 American Coalition for Ethanol Conference

Presented by:

Ty Inglis, CPA & Jim Seurer, CEO

Board Governance & Committee Structure

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Group Discussion

• How effective is your board?

• Are there areas of improvement?

• What topics do you want to address, today?

Source: Great Companies Deserve Great Boards, Beverly Behan

Eight Components That Impact Board Effectiveness

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Board Composition

• Skills – Experience – Background• Diversity of perspectives• Orientation

Source: Great Companies Deserve Great Boards, Beverly Behan

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Building Trust

GLE Trust Building Principles:• “The Whole Truth and Nothin’ But the Truth…”

• Admit mistakes early• Share information• Constant communication• Board vs. management roles• Board works thru CEO

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Developing Team Effectiveness

• Recognize importance of team-building• Board only events to build camaraderie• Strategic planning session includes informal time

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Board Information

• Danger of data overload• Quality of discussion is proportional to quality of information

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Board as Thought Partner

• Genesis for committee structure• Access knowledge base• Builds trust and engagement• High degree skill, success & experience • Board contribution = Strong team

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Board Agendas & Meetings

• Packed agendas• Little meaningful dialogue on key issues• Regulatory/compliance vs. strategy/succession

Source: Great Companies Deserve Great Boards, Beverly Behan

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Board Information & Meeting Preparation

• Board Packets• Financial & production related• Sent out 5-7 days prior to the meeting• Do not include confidential information

• Numbered, handed out for review, collected after discussion

• Meeting preparation varies

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Board Leadership

• How effective are the meetings run?• Drawing out different perspectives• Director performance

Source: Great Companies Deserve Great Boards, Beverly Behan

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Board Education

• Initial orientation• Speakers on board roles• Board responsibilities• Governance best practices

• Business partners• Industry news

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Board Committees

• Are they necessary?

• What is the interaction between the board and the committee?

Source: Great Companies Deserve Great Boards, Beverly Behan

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GLE Committees & Communication

• Risk management – bi-weekly• Finance – monthly• Tech & Ops - monthly• Governance – monthly• Executive – as needed• Salary & benefits – as needed

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Board Dynamics

• What is the climate of your board room? Is it inspiring or dynamic?

• Are board members candid or cautious?

Source: Great Companies Deserve Great Boards, Beverly Behan

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Board Management Relationship

• Is the relationship characterized by candor and mutual respect?

• Is management comfortable sharing bad news and tough issues?

• Is the board utilized as a thought partner?

• Does the board micro-manage?

Source: Great Companies Deserve Great Boards, Beverly Behan

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Board Member Expectations

• Contribute• Engagement• Straight forward insights• Set aside personal agendas• Challenge management & other board members

• “Agree to Disagree” (professionalism)

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Board Processes

• How does the board engage in oversight and decision making?• Corporate strategy• Risk• Succession planning• CEO evaluation

Source: Great Companies Deserve Great Boards, Beverly Behan

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GLE Strategic Planning

• Annual, 2-day session includes:• 1st Day = Board & CEO discusses human

capital• 2nd Day = Board, CEO & senior management

• Develop strategic priorities• Management develops action steps

• Strategic plan approved at future board meeting

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CEO Evaluation Process

• Focus: Strategic objectives & individual goals

• Company performance considerations• CEO self assessment• Individual board member evaluations• Establishment of new goals• Evaluation of past objectives

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Components of Effective Board

• Basic principles• Engagement • Upstanding character• Honesty, even if bad news• Egos & personal agendas in check• Integrity is critical• Listen!

Thank You

Ty Inglis, CPA Jim Seurer

Partner CEO

612.253.6547 605.882.8480

tinglis@eidebailly.com jseurer@glaciallakesenergy.com