The structure of a Board of Directors (BOD) or board of trustees is one of the most important factors determining an the success of an organization. A well-organized board will ensure that each member understands https://allsmarthomecompany.com/virtual-board-rooms-merging-security-and-corporate-strategy/ their responsibilities and how they fulfill it, and helps to put the company or organization on the right track to reach its desired goals.
The board is principally responsible for directing the executive board and determining the overall direction of the company. The board is also responsible for the hiring and firing of CEOs, determining CEO pay, determining compensation for other executives in the company, and making important strategic decisions.
External or independent directors are non-executive members of a board who do not hold executive positions in the company and can be paid fees for their participation. They provide different perspectives to the board, and are typically subject-area experts in the field that the company is operating in.
A two-tier board includes a management board made up of company executives, and a supervisory board which is composed of directors who are independent. The supervisory board makes sure that the management board is operating in accordance with corporate policies and laws.
A advisory or consultative board is made up of those who have a stake in the company. This could include investors or customers. Advisors can provide information to the top executives of a company, and provide different perspectives that may not be offered within the company itself. They can also help to identify potential growth opportunities and help with the implementation strategies that meet a company’s goals.