The role of the board
"The job of the board is all to do with creating momentum, movement, improvement and direction. If the board is not taking the company purposefully into the future, who is?" (Harvey-Jones, 1995).
The role of the board can be outlined into four broad areas:
1. Establish vision, mission and values
- Determine the organisation's vision and mission to guide and set the pace for its curent operations and future development.
- Determine the values to be promoted throughout the organisation.
- Determine and review organisational goals.
- Determine organisational policy.
2. Set strategy and structure
- Review and evaluate present and future opportunities, threats and risks in the external environment and current and future strengths, weaknesses and risks related to the organisation.
- Determine strategic options, select those to be pursued and decide the means to implement and support them.
- Determine the business strategies and plans that underpin the organisational strategy.
- Ensure that the organisation's organisational structure and capabilities are appropriate for implementing the chosen strategies.
3. Delegate to manage
- Delegate authority to management, and monitor and evaluate the implementation of policies, strategies and business plan.
- Determine monitoring criteria to be used by the board.
- Ensure that internal controls are effective.
- Communicate with senior management.
4. Exercise accountability to members and be responsible to relevant stakeholders
- Ensure that communication both to and from members and relevant stakeholders is effective.
- Understand and take into account the interest of members and relevant stakeholders.
- Monitor relations with members and relevant stakeholders by gathering and evaluating appropriate information.
- Promote the goodwill and support of members and relevent stakeholders.
The objective of an organisation and the regulation of an organisation are both set out in the articles of association. It is the responsibility of the board to look after the affairs of the organiation and ensure it lives up to its objective staying within the rules govering it.
Getting the right people onto your Board is crucial. Your governing document will dictate how individuals get appointed onto your board. If you have an election process for appointment onto your board you may struggle to get the people with the right skillset to fulfill the role of the board effectively. If this is the case you can consider one of the following options:
- changing your governing document to allow you to appoint board members
- adding to your current board structure the option of appointing a certain number (two or three) of independent board members to help you fill the skill gaps
- up-skilling and training the elected board members so they become more aware of the role they hold and their responsibilities
- making your members more aware about the role of the board and encouraging them to elect people with the skills that your organisation needs.
Once you have the right people you will need to give them a full induction so they understand your organisation and then continue to monitor their effectiveness and breadth of skills.
Resources to help with this can be found under this section by using the menu on the left-hand side. There are also documents below and on the other pages in this section to help you see what other organisations have done to identify the role of their boards.
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