Directors are elected by shareholders or appointed by other board members, and they represent shareholders of the company.
A board of directors (BOD) is an elected group of individuals that represent shareholders. The board is a governing body that typically meets at regular intervals to set policies for corporate management and oversight.
Every public company must have a board of directors. Some private and non-profit organisations also have a board of directors. The board of directors is the primary direct stakeholder influencing corporate governance.
Directors are elected by shareholders or appointed by other board members, and they represent shareholders of the company. The board is tasked with making important decisions, such as corporate officer appointments, executive compensation, and dividend policy.
In some instances, board obligations stretch beyond financial optimisation, as and when shareholder resolutions call for certain social or environmental concerns to be prioritised.
Boards are often made up of inside and independent members. Insiders are major shareholders, founders, and executives. Independent directors do not share the ties of the insiders, but they are chosen because of their experience managing or directing other large companies.
Independents are considered helpful for governance because they dilute the concentration of power and help align shareholdersโ interest with those of the insiders.
From the Book โ โ Know Everything about Corporate Social Responsibility โ
Available on Amazon.in
Also Read:
- What is Industry?
- What is Business?
- What is a Business Organisation?
- What is Corporate?
- What is a Startup?
- Who are the Stakeholder?
- What is a Multinational Corporation?
- What is Competitive Advantage?
- What is Foreign Investment?
- What is Economic Reform?
- What is Industrial Reform?
- How are the Reforms and Fiscal Policies Linked?
- How does Growth Impact Employment?
- What is a Labour Market?
- What is Humanistic Management?
- What is the Public Enterprise?
- What is a Private Firm?
- What is Family Owned Business?
- What is Corporate Financial Performance?
- What is Profit?
- What is Bottom of the Pyramid?
- What are the Basics of Corporate Structure?
- What is Corporate Governance?
- What is E-Governance?
(India CSR)
