If it’s setting the strategies, overseeing management and finances, building community relationships or setting ethical standards and values, the roles of the management board are numerous and varied. Boards elect a CEO, and monitor their progress; they determine the direction of an organization through the development of the vision, mission and strategic thrusts as well as goals; build community relations and establish management procedures for quality and compliance, governance and quality; and address organizational changes that occur from changing circumstances or regulatory pressures.
As fiduciaries boards are legally accountable for representing shareholders and owners as well as investors. They decide on policies for dividends and payouts, as well as hire/fire and reward management. They also create corporate rules. They also maintain a clear relationship with management and represent the organization. The chair of the board, often elected from the board’s membership, is a leader of the entire board. They are typically non-executive directors (NEDs) who serve as the liaison between the chief executive officer and the board.
The biggest function of the board is to act as a steward for the organization. Some boards however, go over the line and try to run the organization themselves, rather than ensuring that the actions are consistent with the organization’s mission. Boards must keep in mind their oversight role and their responsibility to ensure organizational success. This can be accomplished efficiently through committees. Audit compensation, nominating, and audit committees, for instance are now popular methods of looking at complex issues. These committees present their findings to the entire board.
