The Purpose of Board of Directors
Have you heard the term “Board of Directors”? I’m sure you’ve heard it on the news or in the movies but do you really know what this term is all about? For starters, the board of directors refers to a body or group of people who were appointed or elected to join together to do one thing and that is to oversee the entire projects or activities of an organization or a company. This group of people has a unified roles and responsibilities to undertake, so let’s check out its purpose to better understand.
Typical Roles of the Board of Directors
The board of directors doesn’t just have one role, in fact this group has tons of roles and responsibilities to take and some of its typical or common duties are; they are usually in charge of creating a wider and broader rules and regulations to be followed by people within an organization or company. They set objectives to be met, and most of all they are responsible in selecting the right person to take the position of the executive manager or the CEO (Chief Executive Officer). The board is also in charge in approving the yearly budget of a company, the salaries and compensations, the benefits, and a lot more.
Recruit and Evaluate Managers
Recruiting the right CEO and the right managers are the directors’ responsibility. They must evaluate, supervise, retain and even compensate people with higher positions in the company. Although this is one of the most typical roles of the board of directors yet this is also the most important role they have to play. These directors must actively and proactively search people within the company who are capable of running or acting as the CEO. Their roles is not mainly to appoint but they must also evaluate every one and see to it that they will end up with a sane and right decision for the benefit of the company or business.
Gives Direction to the Company
Board of directors are not just there to appoint but also to create the vision, mission, goals and objectives of the company or business. Because they are in charge of these things, it only means to say they are there to drive and guide the company or an organization to the right path. People within the business must ensure to follow these standard vision, mission, goals and objectives for the success of the business. In addition, the rules that will be established by the board of directors must also be policy based. However, these policies are usually broad in nature in order to give room to managers to achieve the goals of the business.
Have your Own Board of Directors
As you may already know, the board of directors are quite important to ensure not just the direction of your managers and CEO in the organization, business or company but also to ensure the success of your team. Therefore, we can conclude that these directors definitely have a lot of things to accomplish and being one of the directors is not an easy position to fulfill.