A board of directors assists companies function more effectively and efficiently. They provide strategic oversight and advice in the form of checks and balances on management, and help ensure that decisions are made in the best interests of shareholders. They help a business maintain compliance with the law and minimize risk. Based on the type of organization, a board of directors could be comprised of either outside or inside members. An inside director will be an employee, whereas an outside director could be a significant shareholder, or someone with a good reputation in their field.
The director’s role is to ensure that a company operates in the best interest of all stakeholders, including employees as well as investors and suppliers/vendors. This is done by formulating corporate strategies, establishing priorities, and providing crucial input and constructive challenges on a variety of topics like development of talent and culture, sustainability and resilience and risk management technology and digitization. A board of directors could become an integral partner to the CEO and management team by doing this.
For an individual who is interested in a position on a board of directors is an extremely coveted job that is attractive on a resume and offers an excellent opportunity to develop leadership capabilities, increase knowledge of the industry and market and build networks. It also allows you to become a savvy decision maker in a team environment. However, it is crucial for prospective directors to comprehend the responsibilities associated with this position and be prepared to put time and energy into the position.