A board of directors can help a company function more effectively and efficiently. They act as a check-and balance on management, providing strategic guidance and oversight. They also help to ensure that decisions are in the best interest of shareholders. They also aid a company maintain legal compliance and reduce risk. A board of director can comprise of members who are outside or inside dependent on the type of company. An inside director will be an employee, whereas an outside director would be a significant shareholder, or someone with a strong reputation in their area of expertise.
The director’s role is to ensure that a company operates in the best interest of all stakeholders, including employees, investors, and suppliers/vendors. It accomplishes this by establishing a corporate strategy and setting priorities, as well as offering critical input and constructive challenges on a variety of issues like culture, talent development sustainability, risk and resilience management, as well as technology and digitalization. Through this the board of directors can become an effective partner for the CEO and for the entire management team.
For a person the position of the board of directors is a highly regarded job that is attractive on a resume and offers a unique opportunity to build leadership capabilities, increase knowledge of the industry and market and expand networks. You can also become a more effective decision maker in a group environment. It is essential that prospective directors are aware of the responsibilities they have and are prepared to commit their time and energy in the job.