The role of the board is to govern the company by exercising a strict and diligent surveillance in key areas like strategy and risk. It cannot, however, micromanage the company’s operations by interfering with management’s responsibilities. The purpose of these responsibilities is to assist the executive team and the CEO create value for shareholders.
Boards must have an organized structure and a clear governance framework to perform their read more duties effectively. This includes a clear definition of roles between the chairperson and directors on their own, as well having a well-established method for determining priorities and making decisions.
A solid board governance framework also requires a well-trained process for arranging meetings, which includes the agenda items. It also provides a strong governance framework that outlines clearly the purpose of the board and its relationship with management. The framework contains a statement of the board’s governing principles and values, such as integrity and transparency.
Additionally, the board should have a clear and concise plan for selecting and developing a CEO and overseeing succession planning. The board should have a strategy to address urgent issues and be able to shift its focus when necessary. The board’s governance practices must be aligned with the business and the board must be in a position to anticipate and respond to the changes occurring in today’s rapid-moving and highly complex environment. This is why board members need to make a rigorous commitment of time and energy to their duties on the board.
