When it comes to setting strategies, overseeing management and finances, developing relationships with community members, or establishing ethical standards and values, the duties of the management board are numerous and diverse. Boards choose a CEO and monitor their progress; they decide the direction of an organization through the development of a vision, mission and strategic thrusts, as well as goals; build community relations; establish management practices for quality, governance and compliance; and deal with the need for organizational changes from changing circumstances or regulatory pressures.
As fiduciaries, boards are legally responsible for representing owners/shareholders as well as investors. They determine policies for dividends and payouts, as well as hire/fire and reward management. They also set corporate rules. They also maintain a close communication with management, and also represent the organization. The chair of the board, typically elected from the membership of the board is a leader of the entire board. They are usually a non-executive director (NED) and serve as the liaison with the chief executive officer.
The board’s main function is to serve as an administrator of the organization. Some boards however, go over the line and attempt to run the organization themselves instead of ensuring that the activities are in line with the company’s mission. Boards should concentrate on balancing their oversight functions with their responsibility for successful organization. This can be accomplished most efficiently by utilizing committees. Audit compensation, nominating, and audit committees, for instance have become popular methods of examining complicated issues. These committees report back to the entire board on their findings.
