The Board of Directors (Board of Directors, abbreviated: BOD) is a group of elected individuals representing the shareholders, meeting regularly to establish the management and supervision policies of the business.
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Concept
Board of Directors English is Board of Directors, BOD.
Board of Directors (BOD) is a group of individuals elected to represent the shareholders. The Board of Directors is a management body that holds regular meetings to set corporate management and supervision policies.
Every publicly listed company must have a board of directors. Some private and nonprofit organizations also have boards of directors.
Characteristics of the Board of Directors
In general, the board of directors makes decisions as a fiduciary on behalf of the members of the Board of Directors. shareholder. Issues that the board should consider include hiring and firing senior executives, dividend policy, options policy, and executive pay policy.
In addition to those duties, the board of directors is responsible for helping a corporation set broad goals, support executive duties, and ensure the company has its resources managed. good management.
The structure and authority of the board of directors is determined by the regulations of the organization, such as regulations on the number of board members, how the board of directors is elected. board of directors (e.g. by shareholder vote at the annual meeting) and how often the board meets.
Although there is no specific number of members specified for a board of directors, the number of members is mostly from 3 to 31 members. Some analysts argue that the ideal number of members is 7.
Boards should represent both the interests of both management and shareholders, and include members. internal board of directors and independent board members.
Internal board members are members who care about major shareholders, officers and employees, and have experience in the company. Internal board members are typically not paid for their role on the board, as they are often a senior executive, major shareholder or other stakeholders, such as public representatives. union.
Independent board members do not participate in the company’s day-to-day internal operations.
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These board members are often compensated for attending meetings. Independent board members bring an objective, independent view to set goals and resolve any disputes of the company. They play a very important role in achieving a balance between internal and independent members of the board of directors.
The board structure may vary from place to place. geographical location. In some European and Asian countries, corporate governance is divided into two tiers: the executive board and the supervisory board.
The Executive Board consists of members who are elected by employees and shareholders and are led by the CEO or management. The Executive Board is in charge of day-to-day business operations. The supervisory board is led by someone other than the chief executive officer and deals with the same issues as the board of directors.
(According to Investopedia)
