Board Management Principles

The role of the board is to provide guidance and oversee the executive management team. It ensures that the company’s policies are implemented and that all fiduciary obligations are met. While some boards grant too much authority to their executive leaders however, the majority do not go far enough. The media is filled with tales of business disasters which are the result of improper or unqualified management teams.

One of the most effective ways to avoid disasters is to ensure that your board has a broad spectrum of skills and perspectives and can work effectively as a unit. This requires establishing certain principles of management for your board that include accepting diversity when creating your board and taking on leadership roles, encouraging a flexible structure (e.g. the formation of committees to address new risks) and ensuring www.contactboardroom.com ongoing assessment of both the board itself and individual members.

Another principle of board management is to avoid getting involved in operational issues, particularly when it comes to the day-to-day operations of your company. The main role of a board is to set the long-term vision for your company and its place within society.

Although this might seem like a straightforward idea, many companies struggle with this concept. Certain board members, for example initiate meetings with the management, without the CEO’s knowledge. They also quickly make conclusions that could help. This can put the CEO in a tough position. The ideal scenario is for the CEO to collaborate with the chair of the board and other directors to address this issue and establish trust again.