Board Management Principles

Boards are unique leadership structures that hold significant power, and they are accountable to those who are both inside and outside the organization. They operate within a flexible structure that is only limited by state-by-state rules, and the collective will to change their own composition and structure.

While boards have a lot of responsibilities however, they should focus on oversight and management policy decisions while leaving operational matters to the CEO and executive team. This means creating the framework for governance and creating policies to guide their actions and those of managers. It also involves considering legal issues including compensation, conflicts of interest, community benefits, and the CEO’s evaluation.

A well-functioning governance system is vital to a board’s work, and it should include an explicit description of the roles and obligations of each director and committee. All directors should be able to access and use the board portal. This will allow directors to plan meetings efficiently and keep discussions on the board focused on the primary issues at hand. It also facilitates better communication between members and an easier transition when board members rotate.

A good governance framework includes the appointment of a lead or presidency director, an independent board member who is responsible for the efficient conducting of meetings and sets an agenda. In addition to that, it should include scheduling of executive sessions in accordance with the requirements of the stock exchange and a provision for time for directors to meet individually with the CEO in the absence of management.

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