How much can you save by changing your D&O questionnaire process?
There are a lot of ways to look at the cost of conducting these kinds of compliance related activities, but I want to focus particularly on the cost that I think most Directors and Officers would agree is singular in importance — their time. How much time did it take your Directors and Officers to complete the process?
The average D&O Questionnaire is about 40 pages long. Yet, the number of questions that the average Director or Officer has to answer only takes up about 12 to 15 pages. The rest of the pages are either questions that don’t apply to them, or are explanatory notes, definitions and various schedules and appendices containing compensation or stock ownership details.
Seasoned Directors & Officers are probably quite used to the form and can focus quickly on the questions they need to answer, but they still have to wade through 40 pages. And sprinkled throughout these 40 pages are often changing definitions of terms such as “Family Member,” “Associate,” and “Beneficial Interest” — all of which the directors have to consider in answering questions, but then refer to an appendix to read the two paragraph definition.
It’s no wonder that every year, at every company, there is always at least one questionnaire that doesn’t get fully completed. And this takes yet more time.
The great thing about technology is that it can help us save time. Often lots and lots of time. And moving the D&O Questionnaire to an online process does just that. We can reduce the number of questions, make them easier to follow and answer, and make accessing definitions and schedules as simple as hovering the mouse over a term or clicking a link.
Directors who used our online process for the first time said that it cut their time in half — saving them an hour or more. If you have 15 people taking your D&O questionnaire, that is a lot of time you are putting back in the hands of your most highly compensated people.