A board of directors is a body which oversees and safeguards the long-term interests of its shareholders. The board is comprised of highly experienced members with a range of talents, a strong board is crucial for every business.
Traditionally, boards have supported and endorsed strategies proposed by executives while directing management teams. A well-designed board is now able to provide a proactive leadership in important areas such as corporate vision and strategy including risk and opportunity as well as sustainability, talent and succession of leadership.
The board of directors of a business typically consists of both outsiders and insiders. An outside director is someone who is not employed by an organization. To qualify as an independent director, the person must not have any ties to the company.
When you are putting your board, you should consider people who are passionate about the goals of your company and have a vast industry knowledge. It’s also important to have individuals with a range of skills and who are able to bring creative problem-solving and innovation along with strategic thinking. You should also look for individuals with specialized expertise like marketing, finance, and capital raising.
It’s crucial to understand that as an official on the board you are bound by fiduciary responsibilities and are legally accountable for the company’s top-level decisions. If you’re a shareholder, then you also have the power to cast a vote for board members during the proxy voting time. If you’re thinking of voting for a board member, make sure you go through their proxy documents carefully and verify that they are truly independent.