19 Jul Essential Responsibilities of Boards of Directors
The board of directors plays an important part in the management of a corporation. The board is composed of people with a variety of backgrounds and skills who are not connected to the management team of the company or its members. They are independent of the management and daily operations of the company and are able to offer a fresh view of any strategic issues that could arise.
The primary job of a corporate board is to set the organization’s vision objectives, mission, and values. It usually works in collaboration with the CEO or general manager of the company. The board also assists the company in achieving its objectives through the creation of a strategic plan and strategy for managing risks. The board also provides important contacts and networks to the company.
The board’s second responsibility is to ensure that the company is legally governed and operates in accordance with its stated mission and purpose. This includes ensuring the board understands the legal documents of the business, such as bylaws and articles of incorporation as well as applications for tax exemption status. The board also ensures the company follows its legal reporting requirements.
The board is also accountable for the selection of the CEO, setting his compensation and overseeing the management. The board is also accountable for ensuring the financial statements of the company as well as aiding the chief financial officer to develop short- and long-term company strategies based on SWOT analysis. In addition the board is accountable for evaluating and assessing its own performance and providing training in leadership for all its members.
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