What is your board's embarrassment IQ? This quiz will place you on a scale ranging from "I sleep well at night" to "I must take immediate action.".

• Author: Patterson, Gary W.
• Position: INFORMATION FOR THE BOARD

JACK AND SUZY WELCH raised a provocative point in their Business Week column, "The Boardroom Bunker," earlier this year. "Too often," they observed, "the question is: 'Has anything happened lately that could embarrass us?'"

The sad truth is that too many boards would be forced to answer a resounding "yes."

Although progress has been made to guard against governance scandals, too many board members today are in the dark--sometimes even clueless--when it comes to knowing the fundamental facts (read: financial health and profile) of the companies on whose boards they sit. According to the Welchs, real progress in boardroom behavior will be evident when members can resume their rightful roles of helping to develop a strategic vision that furthers the company's growth and profitability, instead of hunkering down and peering into an abyss of financial reports.

While this is a noble "meta" role, my first-hand experience with some board members tells me we're not there yet. I'm continuously amazed by what board members don't know that will indeed embarrass them if pressed against the wall. My perspective is a twist on the adage, but I truly believe that if you can't see the trees for the forest, you're overlooking fundamental, if not critical, knowledge of your company's business.

While the questions below may sound rudimentary, if not rhetorical, depending on your answers you may be a deer in headlights, or at least blushing with embarrassment. You be the judge.

What is your gut reaction to where the company stands?

Another way of asking this question is, "How well do you sleep at night given what you know (or don't know) about the company?" For example, based on the board package and other company materials you receive before board meetings, do things feel right, or do you have a gnawing feeling you can't quite put your finger on? After all, the board and your CEO's credibility are impacted positively or negatively by finance, operations, sales, human resource, or communication issues. One way of gauging the reputation of your company is checking how aggressively prestigious service providers and financial institutions seek the company's business.

Do you really know the direction in which the company is headed?

If you were to begin signing Sarbanes-Oxley equivalent certifications with personal liability on current financial statements or fiscal projections, what else would you ask or want to know about the company's growth and viability? It's...