Preparing for a corporate board of directors role is a significant milestone in your professional career.
Being a member of a for-profit or corporate board of directors means serving as a member of a governing body responsible for overseeing and guiding the strategic direction, policies, and decision-making of a company.
Board members are typically elected or appointed by shareholders or stakeholders and have a fiduciary duty to act in the best interests of the company and its shareholders. Here is a basic overview of the structure of a board of directors:
Chairperson: Also known as the chairman or chairwoman, is the leader of the board.
Directors: Also called board members, are individuals elected or appointed to serve on the board.
Executive Directors: In some cases, directors may also hold executive positions within the organization, such as the CEO, CFO, or other senior management roles.
Independent Directors: Independent directors are individuals who are not employed by the company and do not have any significant business relationships with the organization. They are considered to be impartial and bring an outside perspective to the board. Read more about Independent Directors here.
Board Secretary: The board secretary is responsible for maintaining accurate records of board meetings, taking minutes, and ensuring compliance with legal and regulatory requirements.
Committees: Boards often establish committees to focus on specific areas of governance or oversight. Common committees include an Audit Committee, Compensation Committee, Nominating and Governance Committee, and Strategic Planning Committee. These committees consist of selected board members and may include independent experts or advisors.
BOARD MEMBER DUTIES
Here are the 7 key duties for members serving on a board of directors:
The specific roles, responsibilities, and expectations of board members can vary depending on factors such as the company's size, industry, and corporate governance framework. But it is important to note that being on a board of directors involves legal and ethical responsibilities. Board members must act with due care, loyalty, and good faith, avoiding conflicts of interest and acting in the best interests of the company.
Read our blogs, Am I Ready for a Corporate Board of Directors Role?, and 5 Ways to Strategically Position Yourself for the Boardroom, for further information on the qualifications and experience typically needed to join a for-profit company’s board of directors.
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