Many of the sayings remind managers and entrepreneurs that it’s a must to have a great team to build a great company. The board of directors is the one responsible for the success of public businesses.
The board is responsible for taking important strategic decisions like merging with another firm and buying or selling shares, and distributing dividends. It also has to deal with important financial matters, such as determining the compensation of top executives or approving the annual budget. The board acts as a protector for the chief executive in emergency situations by providing direction.
A functioning board adds enormous value to a company by providing a sounding board to management, giving an objective view of the situation, and providing constructive challenges. This is particularly crucial in businesses with a complex business model or highly restricted by law (like healthcare and financial services).
Boards are increasingly expanding their responsibilities to address issues such as organizational culture and talent development. They also have to spend more time working outside of formal meetings and become more digitally educated. Frithjof, a McKinsey senior consultant, states that they should also promote a culture that is constantly learning.
This is why it’s more important than ever that directors are both competent and ethical. They must have deep expertise in the industry they are working in and a commitment https://boardnearme.com/best-online-fundraising-platform-for-your-nonprofit/ to the company’s mission. They must also have the ability to manage their time, which might be a part of committees or acting as an ambassador for a company. They must also be aware of the importance of maintaining a balance between a board’s work and personal life.