A board is a key corporate governance role to ensure that a company operates lawfully and in the best interests of shareholders and other stakeholders. This requires the board to operate independently of management and focusing on the company’s most important concerns rather than its day-today operations.
The board is responsible for the management of risk and the strategy and operation of a business, as well as other decisions that are reserved for it. It also decides on and oversees the performance of the CEO as well as the succession planning process for the CEO and also establishes the company’s values and culture.
It also promotes shareholder interest It also ensures that financial information is accurately reported, and ensures that investors get all the information that could impact their investments. It also takes measures to safeguard the integrity and reputation of a company and to prevent fraud. Directors should be encouraged to be informed regularly in particular about the latest technology and other important issues, such as environmental governance, social, and governance (ESG) or global crises that affect the way businesses are operated.
A well-organized committee structure, including a secretary and a chair plays a vital role in effective governance. It is important to establish a culture of open communication and collaboration between all members of the committee. The committee secretary will help set the agenda, record minutes of meetings, and distribute them to all members of the committee.
A committee should be able to trust the reports, advice and opinions of its advisers. It is vital that the committee is aware of the role of these advisors and assesses their credentials.