Responsibilities of Board of Management

The board’s professional standards often reflect the level of professionalism of the organization as a whole. In this article, we will analyze the common responsibilities of the board management and their place in corporate governance.

How does the board work?

Just as an organization develops a work plan for the year, the board sets goals and objectives for the current year, which may relate to the development of the board’s activities or be built based on the most important tasks of the company outlined in the strategic plan. The board’s annual goal-setting sessions help it focus on strategic goals without getting bogged down in routine, minutiae, or inertia. Well-performing boards find it helpful to effectively structure the board’s work by having a schedule for performing its recurring functions, which sets out the board’s ongoing tasks, e.g., budget approval, program evaluation, executive evaluation.

What are the basic boards` functions?

  • The board contributes to the mission

One of the main responsibilities of the board is to define, articulate the mission of the organization, make sure the organization follows that mission, and promote it in the community. The board’s most important responsibility in this regard is to ensure that the mission is in the best interest of the community or members of the organization and that the company is guided by its mission in everything it does. The board must also ensure that the mission is realistic in scope, reasonable in cost, and expected results.

  • The board carries out planning

Planning is an activity aimed at realizing the mission and increasing the accountability of the organization. It is the process of setting goals, formulating a strategy to achieve them by attracting and allocating resources. The result of planning can be different documents – the annual budget, staffing, a full-fledged strategic plan. Regardless of this, planning as an effective and regular process is one of the main responsibilities of the board.

The board usually controls the planning process in general, rather than going directly into its details. Since the board is not involved in the day-to-day operations of the organization, it can bring valuable, inclusive “outside perspective” to the planning process by testing whether core employee commitments are realistic

  • The board control the company`s activity

The board enforces standards in the company in other ways as well. The subject of monitoring is the services provided, salaries and bonuses to management, the accuracy of published information. This and much more are the indicators that make up the reputation of the organization in society. The board must ensure that errors in these areas are corrected and do not cause irreparable damage to the reputation of the organization.

What are the functions of the board chairman?

Like any group, the board cannot function effectively without an appointed leader. The chairman is primarily responsible for coordinating the work of the board and serves as the liaison between the board and the staff, especially the manager. The chairman’s duties usually include holding meetings and appointing committee members.

The chairman of the board has the following responsibilities:

  • Scheduling board meetings.
  • Development of the agenda (together with the board).
  • Leading the discussion during the meeting; following the agenda and following the procedure.
  • Coordinating the activities of the board between meetings.
  • Appointment of committee chairs and, if time permits, serving ex officio on all committees.
  • Leading the recruitment process and performance appraisal of the executive director.
  • Ensuring the good performance of the board, including evaluation of its performance.
  • Public presentation of the organization.