The board of directors play an important role in the management of a corporation. The board is comprised of people with a variety of backgrounds and skills that are not part of the management team or the company. This means they operate independent of the day-to-day management tasks of the business and offer a fresh perspective on the strategic issues that could arise.
The main function of a corporate board is to establish the goals, mission, and vision of the organization. The majority of the time, this is done in conjunction with the CEO or the general manager of the company. The board can also assist the company reach its goals by formulating strategies and a risk management program. Additionally, the board can give the company valuable networking and business contacts.
A board’s other essential responsibility is to ensure that the organization is operating legally and in line with the stated mission and purpose. This includes ensuring the board is aware of the legal documents of the company, such as articles of incorporation and bylaws, and applications for tax exemption status. The board also ensures that the company complies with its legal reporting requirements.
The board is also accountable for the selection of the CEO, determining his compensation and overseeing management. The board is also responsible for overseeing the financial statements of the company and helping the chief financial officers develop short- and long-term company strategies based working board of directors on SWOT analysis. Additionally the board is accountable for evaluating and assessing its own performance and provides training in leadership for all its members.
