A board of directors plays an important part in the management of a corporation. It is made up of individuals with a range of skills and experiences that are not associated with the company or its management team. This means that they function independently of the day-to-day management activities of the company and offer a fresh perspective on any strategic issues that might arise.
The main function of corporate boards is to set the vision, mission and objectives of the company. It is typically decided in conjunction with the CEO or general manager of the business. The board can also help the company achieve its goals by formulating strategies and a risk-management plan. Moreover, the board can help the company by providing invaluable business contacts and networks.
Another important duty of the board is to ensure that the company is operating in compliance with its stated mission and goals. This includes ensuring that the board is equipped with an knowledge of the company’s legal documents that govern the organization, such as articles of incorporation, bylaws and applications for tax-exempt status. The board also ensures the company adheres to its legal reporting requirements.
In addition, the board is responsible for hiring and setting the compensation for the CEO as well as overseeing the company’s management. The board is also responsible for overseeing the financial statements of the company as well as helping the chief financial officer develop short- and long-term company strategies based on SWOT analysis. The board is also responsible for assessing its own performance and providing leadership training for all members.