A board of directors has legal responsibility for making high-level decisions. This includes hiring and firing the CEO, directing the strategic direction and making sure that the company is meeting its objectives. The majority of them are former and current executives expert and respected individuals who are selected from the wider community (called outside directors), and it is also responsible for establishing the corporate governance guidelines.

A well-functioning over at this website board is one that has a clear goal and is able to operate with open communication and respect for different viewpoints, and accountability to shareholders and stakeholders. It also includes directors who are independent who are free of conflicts of interest and have an outlook for the long-term company’s success. The importance of having a formal orientation, developing relationships with members, and meeting on time is vital.

In addition to having business acumen an effective board member has intellectual curiosity and is competent to ask the management and other members of the board constructive questions that challenge group thinking and aid in making the most appropriate decision. A board member’s niche experience can be a great asset.

Boards are increasingly being asked to take on new responsibilities, such as strategic planning and risk and resilience management. They also have to manage the issue of diversity and inclusion, technological advancements and digitalization. They must be more tech-savvy and play a larger role in the selection of CEOs and other senior leaders. According to McKinsey COVID-19, the pandemic taught boards to be more proactive when it comes to addressing crisis and preparing for uncertainty.