In a world where risks and threats are constantly changing the main responsibility of a board is to oversee the corporate mission. A board of directors functions independently of the company’s management and focuses on the organization’s major issues rather than its daily operations. It sets policies, establishes corporate strategies, evaluates executive reward and compensation, provides advice on financial matters, makes investments, and focuses on managing the risk.
In order to fulfill this obligation, a board should make decisions that it believes will benefit the success and growth of the corporation. This includes taking into account the following key elements:
Identifying and analysing the potential risks that an organization could face. The board must determine and assess the security, financial and legal risks of the company. It should also http://www.boardroomnow.info/working-board-vs-governance-board/ formulate strategies to mitigate threats that may be posed by new and emerging threats such as climate change, digital currencies, artificial intelligence, geopolitical crises, ESG and many more.
It is essential to ensure that the corporation is operated lawfully and in compliance with applicable regulations. This includes ensuring that a company maintains proper books, pays taxes and provides appropriate disclosure to shareholders and other stakeholders.
Finding and evaluating key people. The board must recruit qualified individuals to serve in the positions of president and chair, secretary and treasurer (or combined secretary/treasurer), and other officers as necessary. This entails setting criteria for selecting members of the board, evaluating applicants as well as conducting interviews and deciding which candidates to select.
Helping new and existing board members. Every board member has a duty to help the other achieve their goals. It is essential that board members attend meetings in person or online, participate and share their knowledge and experiences.