What is one key factor in the effectiveness of a company's board?

The effectiveness of a company's board is largely influenced by the engagement of the Chair with major shareholders. This engagement is critical because it establishes a direct line of communication between the board and the individuals or entities that have a significant stake in the company’s performance and governance. When the Chair actively communicates and engages with major shareholders, it not only fosters transparency and trust but also allows for the alignment of the board's strategy with the interests of its shareholders. This connection can lead to more informed decision-making and stronger support for board initiatives.

In contrast, while regular attendance of stakeholders may seem beneficial, it does not guarantee meaningful engagement or effective communication. Similarly, the presence of legal advisers can be important for compliance and risk management, but their role typically centers around legal guidance rather than enhancing board effectiveness. Lastly, minimizing costs of operations is a focus on the company’s financial aspects rather than the governance structure itself, and may not directly influence the effectiveness of the board. Therefore, the Chair's ability to engage major shareholders stands out as a key factor in ensuring the board operates effectively.