Executive Sessions: Structure and Purpose

What Is an Executive Session

An executive session — sometimes called an in-camera session — is a portion of a board meeting from which management and other non-board attendees are excluded. It allows independent directors to deliberate on matters where management's presence might inhibit candid discussion.

The term does not imply secrecy in a legal sense; rather, it refers to a formal separation of a portion of the meeting's proceedings. The topics discussed may include the evaluation of executive performance, potential conflicts of interest, legal matters, or the board's assessment of management effectiveness.

When Executive Sessions Occur

Many governance codes and best practice guidelines recommend that boards hold an executive session at every regular board meeting, regardless of whether there is a specific sensitive matter to discuss. This routine practice normalizes the session so that scheduling one does not signal an extraordinary concern.

Outside of regular sessions, executive sessions may be convened when:

• Evaluating the performance of the chief executive officer or senior management team
• Reviewing compensation recommendations where management has a direct interest
• Discussing potential legal proceedings or regulatory matters under advice of counsel
• Addressing governance concerns raised by independent directors
• Reviewing potential transactions where conflicts of interest may arise

Participation and Exclusions

By convention, executive sessions are attended only by independent or non-management directors. In organizations with a separate board chair and chief executive, the board chair typically presides. Where the roles are combined or where the board uses a lead independent director, that individual may chair the session.

The corporate secretary may attend in a recording capacity, though in many organizations the secretary also steps out to preserve the confidentiality of director deliberations. Legal counsel may be invited to attend specific portions where legal advice is being sought.

Documentation of Executive Sessions

The level of formal documentation maintained for executive sessions varies by organization. At minimum, the regular meeting minutes will note that an executive session was held — typically recording the time it began and concluded, and the names of directors present.

Decisions or recommendations arising from an executive session that require formal board action are typically incorporated as resolutions in the main meeting minutes, rather than in a separate record. This approach ensures that binding board decisions are captured in the authenticated corporate record.

Organizations differ in whether they maintain separate notes from executive sessions or treat the session as entirely unminuted. Both approaches are observed in practice; the choice is often guided by legal counsel's advice on what serves the organization's documentation needs.