6 Reasons to Move Your D&O Questionnaires to Digital
The D&O Questionnaire process used by many companies has long been plagued by inefficiencies and error-prone data collection and verification methods. Technology is at its best when it creates efficiencies and reduces the chance for errors. By migrating the annual directors’ and officers’ (D&O) questionnaire process to a digital database-driven environment, companies can recapture hours of valuable time for directors and corporate governance teams—and improve data integrity along the way.
The proxy disclosure process can be a tedious and time-consuming compliance task faced by corporate governance teams each year. Modern enterprise-level corporations today wouldn’t dream of utilizing paper-based accounting or communication processes, yet there are still some using paper or word processor-based D&O questionnaires.
The digital D&O questionnaire process, especially when integrated with a board portal like Nasdaq Boardvantage®, is designed to help save time and money, free up directors, and reduce data collection and verification errors during proxy season.
1. Time-Saving
According to the Nasdaq Governance Solutions Board Engagement team and feedback received from the boards they work with, organizations that migrate their D&O questionnaires from paper to digital spend less time coordinating the D&O questionnaire process and typically reduce director completion time to a mere 20-45 minutes.
2. Dynamic & Customizable
Another key advantage of digital D&O questionnaires is that they are dynamic and customizable. Multiple versions of questionnaires can easily be created for directors, officers, and CEOs. Glossary terms are linked directly to definitions, enabling directors to instantly see their meanings. Conditional logic permits custom formatting to hide inapplicable questions on an individual basis.
3. Features & Integration
The use of a database to manage information that is pre-populated in the questionnaire is an important time-saving and data accuracy feature of digital D&O questionnaires. The database makes it easy to manage individualized data for the directors and officers, such as bios, equity ownership, and related parties. And the connection between the database and the questionnaire allows directors and officers to seamlessly update their information in the database while completing their annual questionnaire.
Redline functionality, which shows year-over-year changes that are made to this data, allows corporate governance teams to identify what information has been edited by directors.
4. Data Integrity
Data integrity is enhanced as potential human error points are minimized through the use of technology.
The use of a database in a digital D&O questionnaire solution does this by creating a transactional record of each modification to the data. As a result, editing the proxy accurately with all updates included in D&O questionnaire responses is streamlined, and the accuracy of the data is more easily verified.
5. No More Chasing
One of the most cumbersome administrative burdens in the D&O questionnaire process is chasing down answers to incomplete questionnaires. In a digital environment, this burden is minimized because directors cannot submit their questionnaires until every question has been answered.
6. Directors May Prefer It
Tablets are common devices used by directors today. According to the Nasdaq Governance Solutions Board Engagement team, who works with boards on a daily basis, most directors that complete digital D&O questionnaires likely do so on tablet devices.
Given the time savings and convenience of a digital D&O questionnaire, directors and officers that are familiar with digital D&O questionnaires may be frustrated when presented with a process that does not take advantage of modern technology to simplify the process.
Corporate Governance Technology for Forward-Thinkers
Digital D&O questionnaires have become a solution of choice for many organizations worldwide. Organizations that delay the transition to digital D&O questionnaires may be missing an opportunity to leverage corporate governance technologies that help improve the board, boost disclosure effectiveness, and pay for themselves in time and money saved.
The Nasdaq Governance Solutions Board Engagement team helps public, private, and non-profit organizations with the design and implementation of D&O questionnaires. The team tailors the process to assist each board as they pursue their governance objectives. Hosted in the Nasdaq EnGauge™ platform, digital D&O Questionnaires help ensure accuracy in disclosures, promote efficiencies, improve responses, streamline reviews, save time, and lower costs. To learn more, visit nasdaq.com/solutions/directors-officers-questionnaires or email Contact@Nasdaq.com
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Corporate Governance Risk & Compliance
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