Definition

Responsibilities of Board of directors

The board of directors operates as the representatives of the firm’s stockholders. Elected by the stockholders,  the board has these major responsibilities:

  1.  To elect the company’s top officers, the foremost of whom is the CEO.                                  
  2.  To establish the compensation levels of the top officers, including their salaries and bonuses.
  3.  To determine the amount and timing of the dividends paid to stockholders.                               
  4.  To sets broad company policy on such matters as labor-management relations, product or service lines of business, and employee benefit package.                                                                
  5.  To set company objectives and to authorize managers to implement the long-term strategies that the top officers and the board have found agreeable.                                                                  
  6.  To mandate company compliance with legal and ethical dictates.

 

Share it:  Cite

More from this Section

  • Golden Parachutes
    A form of bonus compensation designed to retain talented executives that calls for a substantial ...
  • Weakness
    A limitation or deficiency in one or more resources or competencies relative to competitors ...
  • Organizational communication
    Organizational communication- all the patterns, networks, and systems of communication ...
  • Clarifying strategic intent
    Leaders clear sense of where they want to lead their company and what they expected to ...
  • Expert influence
    The ability to direct and influence others because they defer to you based on your expertise ...