The role of a board’s corporate governance requires insight, oversight and foresight. Directors of boards must be more vigilant and take informed decisions as the business environment becomes more complicated and volatile. It also requires more coordinated efforts from all employees to ensure company success.
A well-formed board should include members with a range of skills and perspectives that are able to challenge the board’s beliefs and perspectives. This will encourage more comprehensive discussions and increase the effectiveness of the board.
As the duties of the board are constantly changing it is crucial to be prepared to deal with emerging technology and issues like climate disclosures collaborative tools transforming remote work and diversity that could impact a business’s bottom line. It’s important to create a culture which rewards and encourages continuous education and discourages complacency.
The board should set the strategic goals and objectives for the near and long-term and establish mechanisms to monitor progress toward those goals. The board oversees the chief executives, and sets the policies and guidelines for the company’s operations.
It is the responsibility of the board to determine which risks are acceptable to take and how to balance them with protecting shareholder interests. The board should create risk assessments, develop guidelines to guide its own actions and those of its manager and establish accountability processes to support the board’s duty of stewardship.