Boards are unique leadership structures that hold considerable power, and they are accountable to people both inside and outside of the organization. They operate within a spherical framework that is only restricted by state-by-state rules, and the collective will to alter their own composition and structure.
The Boards of Directors have a lot to do but should concentrate on overseeing and management of decisions. They should leave operations to the CEOs and executive teams. This includes establishing guidelines and a governance framework to guide both their actions and the management’s. It also means the legal aspects such as compensation, conflicts of interests, community benefits and the evaluation of CEOs.
A sound governance system is crucial to the work of a board, and it should include clear documentation of the duties and duties of each director and committee. It must also be readily accessible to all directors via an online portal for the board. This helps directors efficiently prepare for meetings and also allows board discussions to stay focused on the core issues at hand. It also helps improve communication between members, and an easier transition for board members when rotations occur.
A good governance system also includes the appointment of a lead or presidency director, an independent board member who is accountable for the effective conducting of meetings and establishing the agenda. Additionally it should also include the scheduling of executive meetings in accordance with stock exchange requirements and a provision for time for directors to sit down with the CEO in the absence of management.