A board of directors is an elected group of people who gives expert advice and oversight to businesses. This group is independent of management and focuses on the big issues than the day-today operations. The board of directors of a company is accountable for ensuring that the business operates in accordance with law and in the best interests of its shareholders and other stakeholders.
A successful board will have the right combination of leadership skills as well as governance expertise and experience that serves as a valuable asset for the company. Board members should be more than “yes people,” they must have the courage to challenge management when needed and offer an alternative point of view. The board should not just concentrate on its governance but also be in contact with all stakeholders, including employees as well as customers and suppliers as well as the communities who are impacted by the company’s activities and its strategy.
A board will also set company policies, ensure the implementation of strategic plans, and also monitor their effectiveness. The board will also evaluate the CEO and, should it be necessary, take part in the evaluations of senior management with the CEO. The board can also help the company develop relationships with external stakeholders who are beneficial to the company. It will also inform investors and shareholders about issues that affect the mission and financial performance of the company. This includes the assessment of a company’s financial risk and monitoring global developments like a trade policy and geopolitical conflicts.
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