A board of directors is the legal authority to make high-level decisions. This includes appointing and firing the CEO, overseeing the strategic direction and ensuring that the company meets its objectives. The board consists of experts, respected individuals and former executives chosen from the community. They are accountable for establishing the corporate governance.
A well-functioning board has a clear mission and is open to communication and respect for different viewpoints and accountability to shareholders and other stakeholders. It also includes independent board members who are unaffected from conflicts of interest and have an opportune view of the company’s future. The importance of a formal orientation, establishing relationships with members, and having meetings on time is vital.
A good board member is not only knowledgeable about business, but also curious. They are able to ask thoughtful questions to the management and to other members that will challenge their thinking and lead to the best decisions. A niche expertise like capital-raising or sales experience can be a great asset.
Boards are increasingly taking on more responsibility, including strategic planning and risk and resilience management, diversity and inclusion, and technology and digitalization. In turn, they must be technologically adept and play an increasing role in the hiring process and succession planning for the CEO and other senior leaders. According to McKinsey, the COVID-19 pandemic taught boards to be more https://boardnearme.com/communicate-effectively-to-create-better-board-relationships/ proactive when dealing with emergencies and planning for uncertainty.