What is an Executive Session?
An executive session is the term used for any private block or discussion within a larger board meeting in which only specific members are allowed to attend. These private sessions take place for highly sensitive issues to protect the organization from public scrutiny or other stakeholders’ views.
Typically, executive sessions are utilized in nonprofit, corporate, or governmental boards, which involve the need for discretion in discussion. For an executive session to commence, a motion to that effect must be made, seconded, and voted upon with a majority of the board. Once called to order, the topics are recorded in minutes but must remain classified.
What is the purpose of executive sessions?
Above anything else, executive sessions are held to preserve the organization’s integrity, especially when discussing topics where its legal, financial, and reputational interests may be at risk. It offers a safe space for the board to deliberate privately and frankly. Some of the key purposes include:
- Confidentiality on certain discussions, like legal consultations or personnel reviews.
- Open dialogue to allow board members to express opinions without external influence.
- High-level discussions that may involve long-term strategies, partnerships, or business plans that are not yet ready for public disclosure.
What prompts an executive session?
Executive sessions can either be scheduled or summoned spontaneously without prior notice. Many boards include executive sessions as a regular or routine agenda to address standing issues that require closed-door discussion. Alternatively, executive sessions arise in the course of a board meeting when an urgent, sensitive topic is identified. This flexibility allows the board to address urgent matters right away while maintaining confidentiality.
Who should attend an executive session?
As previously mentioned, executive sessions are intended solely for a controlled group or those involved in the matters at hand. Generally, these are:
- Members of the board or the concerned committee.
- In some cases, certain senior executives, such as the CEO or CFO, may be invited to attend the executive session if their presence is needed for the discussion.
- For discussions that deal with legal matters, a legal counsel may attend to answer questions or provide guidance.
- Consultants or auditors may also be invited to attend an executive session where their expertise on the matter is needed.