Whether it’s setting strategy, overseeing management and finances, building community relationships or setting ethical standards and values, the roles of the management board are many and diverse. Boards elect a CEO, and monitor their progress; they decide the direction of an organization by formulating goals, vision, strategic thrusts and goals; develop relationships with the community as well as establish management guidelines for quality, governance and compliance; and take action to address any organizational changes that occur due to changing circumstances or regulatory pressures.
Boards are legally liable as fiduciaries for representing shareholders and investors. They establish the corporate rules, set policies for dividends, payouts, and herbboardroom.com/how-to-find-a-nonprofit-board-position/ compensation, and appoint and dismiss upper management. They also maintain strong communication with management and are the ones who represent management to the company. The chair of the Board, usually elected by the board members is the leader of the whole board. They are usually non-executive directors (NEDs) who serve as the intermediary between the chief executive officer and the board.
The main function of a board is to act as a steward of the organization. However, some boards get into management, seeking to take on things themselves rather than simply making sure that the activities are in line with the organization’s commitment to its mission. Boards must focus on balancing their oversight responsibilities and their responsibility for ensuring the overall success of the organization. The most efficient way to do this is through the use of committees. For instance, audit, compensation, and nominations committees are now popular ways of examining complicated issues. These committees provide the board in general on their findings.