Antidotes to a board's going stale: there are three: evaluation, education, and renovation. boards must constantly self-renew because great governance requires directors who are on top of their game.

• Author: White, B. Joseph

What is great governance? Experience and research point to a top-10 list of things a board must do for management and the organization to thrive:

1. Set high performance aspirations and a proper tone at the top.

2. Appoint an excellent leader and plan for succession.

3. Help develop and approve a winning strategy.

4. Approve annual and long-range plans and monitor results.

5. Create incentives for desired performance.

6. Ensure quality financial reporting and effective internal controls.

7. Oversee a balance sheet with ample liquidity and prudent debt.

8. Oversee enterprise risk.

9. Be vigilant about capital investments, especially acquisitions.

10. Assist management in uniquely useful ways.

There is one additional thing that directors must do for themselves: Renew the board. Let's focus on this initiative.

A stale board is incapable of delivering great governance, and it's easy for a board to grow stale. Directors can come to view their positions as sinecures and gradually get more and more comfortable depending on the CEO and management to run the business with only superficial oversight. Management dominates the board while acting deferential, pleasing and flattering directors with excellent pay, meals, accommodations, and trips. Meetings are pleasant. Camaraderie is high. Conflict is low. Everyone is happy--until a major problem occurs.

There are three antidotes to a board's going stale:

* Evaluation

An annual board evaluation is critical to keeping the board and its members fresh. At Equity Residential (EQR), the publicly traded real estate company founded and chaired by Sam Zell, the governance committee that I chair manages this process. Sometimes it's written; sometimes I interview each trustee (as we call our board members).

When we do written evaluations, trustees receive two forms: one to evaluate the board, the other to evaluate individual trustees. The latter includes a self-evaluation. We have used the same forms for several years to allow year-over-year comparison of responses and then change the forms to keep the process fresh.

Trustees complete the evaluation forms--some electronically, some hardcopy, it's their choice--and return them to me as chair of the governance committee. I tally the results. Alternatively, I interview trustees and ask for their evaluation of board, committee, and individual trustees' performance as well as ideas for improvement.

At the March governance committee and board meetings, I distribute the board...