The role of a board in corporate governance is to ensure that the company is operating legally and in the best interests of shareholders and other stakeholders. This is why the board operate independently of management, and focuses on important issues rather than day-to-day business.
The board is responsible for the company’s strategies and operations in setting policy, directing risk, and making other decisions reserved for it. It also selects and oversees the performance of the CEO as well as the succession planning process for the CEO and establishes the company’s culture and purpose.
It also promotes shareholder interest as well as ensures that financial information is properly reported, and ensures that investors receive all the information that could affect their investment portfolios. It also takes steps to protect the integrity of a business as well as prevent fraud and frauds. It should encourage ongoing training among directors, especially regarding new technologies, critical issues like environmental governance, social and governance (ESG), and global crises that affect how businesses operate.
A well-structured structure of the committee, including the chair and secretary is essential to effective governance. It is crucial to create an environment of open communications and collaboration between all members of the committee. The secretary of the committee sets the agenda, record minutes of meetings, and distribute them to the members of virtual data room costs the committee.
A committee should be able to rely on the advice, reports and opinions of its advisers. It is crucial that the committee knows who these advisors are and assesses their qualifications.
