In a time where risks and threats are constantly changing, a board’s primary responsibility is to oversee the company’s mission. A board of directors is independent of the company’s management, and focuses on the company’s major issues rather than its day-today operations. It sets policies, establishes corporate strategies, reviews executive pay and rewards, offers suggestions on financial boards of directors responsibilities matters, makes investments, and focuses on managing the risk.
In fulfilling this duty the board must take an decision it believes in good faith will contribute to the success of the business. This includes considering the following core factors:
Identifying and analysing the potential risks that an enterprise may confront. A board should identify the risks, evaluate, and monitor the security, financial, and legal risks that are posed by the company. It also needs to develop strategies to mitigate risks posed by emerging threats such as climate change artificial intelligence, digital currency, geopolitical crisis, ESG and more.
It must ensure that the business is operating legally and in compliance with applicable regulations. This includes making sure that the company keeps proper books, pays taxes and makes the proper disclosures to shareholders and other stakeholders.
Finding and evaluating the best individuals to fill key roles. The board must recruit qualified individuals to serve in the positions of president and chair, secretary and treasurer (or combined secretary/treasurer), and other officers as necessary. This means setting criteria for choosing members of the board, evaluating applications for consideration, conducting interviews, and deciding on candidates.
Assisting current and new members of the board. Each board member has a responsibility to assist fellow board members in achieving their goals. This includes making sure they take part in meetings and attend in person or online and contribute their knowledge and knowledge to discussions.
