The role of a board in corporate governance is to ensure that an organisation is legally run and in the best interest of shareholders and other stakeholders. This role requires that the board be independent of management, and concentrate on the most important issues, not the day-to-day business.
The board is responsible for the company’s operations and strategies, setting policy, managing risk and taking other decisions that are its responsibility. It also selects and oversees the performance of the CEO, as well as the succession planning process for the CEO, and it establishes the company’s culture and purpose.
It also supports the interests of shareholders, ensures that financial data is accurately reported and makes certain that investors receive all relevant information that could affect their holdings. It also takes measures to protect the integrity and reputation of a business and avoid fraud. It is essential to encourage continuous education for directors, focusing on the latest technologies, important issues like environmental, social and governance (ESG) and global crises that affect how businesses operate.
A well-structured structure of the committee, which includes chairs and secretary is crucial to efficient governance. It is crucial to establish a culture of collaboration and open communication between the committee members. The secretary of the committee will create the agenda, record minutes of meetings and distribute them to members of the committee.
A committee should be able to rely on its advisors for advice, reports and opinions. It is crucial for the committee to be aware the role of these advisors and to assess their credentials.
