Boards are unique leadership structures that hold substantial power and responsibilities for those outside the organization as well as those inside it. However, they operate within the framework of a flexible structure, which is only limited by state-by-state guidelines as well as the collective will of a group to change its www.contactboardroom.com/ideas-to-start-a-board-of-directors own structure and composition.
While boards have many responsibilities but they should concentrate on governance and oversight decisions while leaving operational matters to the executive team, including the CEO. This involves establishing guidelines and a governance framework that will guide their actions as well as the management’s. It also requires the legal aspects including compensation, conflicts of interests, community benefits and CEO evaluation.
A well-functioning governance system is vital to a board’s work, and it should contain clear documentation of the duties and responsibilities of each director and committee. It should also be easily accessible and available to all directors through the board portal. That enables directors to efficiently prepare for meetings and helps board discussions keep their focus on the key issues at hand. It also supports better communication between board members and a smoother transition when board member rotations occur.
A sound governance system includes the appointment of an independent director who is accountable for the smooth running of meetings as well as setting the agenda. Additionally it should also include the scheduling of executive meetings in accordance with stock exchange requirements and a provision for directors to sit in private with the CEO in the absence of management.
