The Board’s Corporate Governance Role

Legally boards are required to ensure that the organization accomplishes its goals, has a solid strategic plan and doesn’t get into legal or financial difficulties. The way boards perform their duties varies greatly and is highly dependent on the specific circumstances.

Boards often commit the blunders of getting too involved in operational issues that should be left up management or are unsure collaborative tools transforming remote work regarding their legal responsibility for the actions and decisions taken on behalf of an organisation. This is often due to not keeping up with ever-changing demands placed on boards, or from unanticipated problems like unexpected staff resignations or financial crises. Typically, this is remedied by taking time for discussion about the challenges that directors face and by giving them guidelines and basic written materials.

Another common error occurs when the board chooses to delegate too much power and not examine the matters it has delegated. (Except for the tiniest NPOs). In this situation the board loses its assessment function and cannot determine whether the operating activities contribute to a satisfactory performance of the organization.

The board must also establish a governance system, which includes how it will work with the general manger or chief executive officer. This includes determining how the board will meet regularly, how its members will be selected and removed, and the manner in which decisions will be made. The board also needs to develop information systems that are able to provide accurate data on its past and projected performance to support its decision-making.