The board of directors in corporate management is the most important team that takes on the responsibility for a business. The board sets the goals, vision, and mission and weighs in on issues as strategic planning, mergers and acquisitions as well as capital appropriations, operating budgets, and compensation decisions. The board is also responsible for hiring and firing the CEO as well as setting executive pay rates including profit sharing, bonuses, and employee stock options. Boards are usually organized around committees with specific functions. The audit committee, for example, works with the company’s auditors. The compensation committee is accountable for issues related to the salary of employees and stock options.
Boards are essentially the conscience of an organisation. They ensure that all tasks are completed and that criteria are carefully analyzed prior to being presented to management for approval. Some presidents with a keen sense of discipline utilize the board to enforce the quotas as well as other performance measures for their subordinate executives and they evaluate the performance of their own directors by comparing them against defined standards.
Directors generally do not get involved in the management of policy at a lower level decision-making, but they play a crucial role in establishing big policies for the company. They make crucial decisions for the company, such as closing facilities. They decide on where to invest the company’s money, and they establish long-term goals for growth, quality finance, people and quality. The board should also set guidelines for its conduct and deal with legal issues such as conflicts of interest directors’ independence, conflicts of interest as well as community benefit and the evaluation of the CEO.
