The Role of a Board Director

The board director is a key company member. As a rule, he or she has all the required qualities to ensure the effectiveness of the Company’s management work. Besides, the board of directors has very specific roles and responsibilities within the enterprise.

What Are the Main Board Director’s Goals?

The majority of Board members are independent non-executive directors. Their main role is to set the right goals for the company’s management. Often, their ability to act as a distribution and balancing mechanism stems from the high profile and extensive experience of non-executive directors.

Board directors represent independent and diverse points of view. Their function is to carry out strategic planning and oversight responsibilities. They must be well informed and fully involved in the resolution of all major issues affecting the activities of the corporation.

Board members should be prepared to act quickly and responsibly when they need to take action to comply with fiduciary duties or standards of good governance. A crisis can happen at any moment. They must be prepared to prevent potential crises and manage emerging crises so that they do not adversely affect the corporation.

Role of the Chairman of the Board of Directors

The position of the chairman of the board of directors is considered the main one in the board. The necessary skills, energy, and tact of the chairman determine the working atmosphere, the quality of which ultimately determines the effectiveness of the entire board of directors. The person who will be on the board of directors is determined by the meeting of shareholders. As for the chairman, he/she is elected at the first held meeting of the board of directors.

What counts here is that the functions of the chairman and the CEO fundamentally differ a lot. The chairman of the board of directors manages the board, whilst the CEO is responsible for managing the entire organization. Both roles require different skills and behaviors. The CEO is the person who “creates results” and manages, while the chairman of the board of directors acts more as an idea generator and implementer.

Functions of the Chairman of the Board of Directors

The chairman of the board of directors must cope with several functions at once:

  1. Be a facilitator. The responsibilities include professionally managing discussions, creating a productive environment in the board, encouraging directors to communicate on the merits of the issues under consideration.
  2. Be the “owner” of the company. The person should take the organization as property, build it so that the enterprise flourishes even after the chairman has to leave his/her place.
  3. Be a mentor. The Chairman works closely with the CEO and top management, pays sufficient attention to their professional growth as well as development as individuals.
  4. Be a strategist. The chairman should be able to competently perceive the picture of the world and the external conditions of the enterprise.

Moreover, he/she has to plan the activities of the council. The Chairman determines the frequency and duration of the meetings, the agenda, as well as the rules for preparing questions for the assemblies.

What Are the Evident Responsibilities of a Board Director?

Insofar as a board director is characterized by some basic responsibilities.

  1. Directors should attend meetings on a regular basis.
  2. Directors protect the organization.
  3. Directors should be aware of what the board is doing, understand the company’s needs, including understanding the mission, products/services, and policies. Besides, it’s essential to keep abreast of industry trends.
  4. It is essential that directors keep a proper distance from management. The thing is that the board advises and the CEO manages.

These are the main aspects.