The board of directors plays an important part in the management of a business. The board is comprised of people with a variety of backgrounds and expertise who are not connected to the management team of the company or its members. This index means that they function independently of the daily operations of the management team, providing a fresh perspective on strategic issues that may arise.
The primary role of a corporate board is to determine the company’s vision and mission as well as the goals. This is usually done in conjunction with the CEO or the general manager of the company. The board can help the company achieve its goals by developing strategies and a risk-management plan. The board also provides important contacts and networks to the company.
Another crucial responsibility of the board is to ensure that the business operates lawfully and in accordance with its stated mission and goal. This includes making sure that the board has an knowledge of the company’s documents for 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.
The board is also responsible for the hiring of the CEO, setting his compensation and overseeing management. The board also oversees the financial statements of the company and assists the chief financial officer come up with short- and long-term strategies for the company with a SWOT analysis. Additionally the board is accountable for assessing and evaluating its own performance and provides training in leadership for all its members.