The New Leader's 100-Day Action Plan, 5th Edition

CHAPTER 11Manage Your New Board

At their core, boards of directors provide oversight, approve the most material decisions, and advise, whereas management has accountability for strategy, operations, and the organization. The best do these together, complementing and supporting the other's roles and strengths. So easy to say. So hard to get right across different types of boards and organizations.¹

Board Accountabilities and Responsibilities

As a general principle, a board of directors of a for‐profit company in the United States is charged with “maximizing the value of the corporation for the benefit of its shareholders.”² Boards do this by making decisions and providing oversight in compliance with the directors’ duties of care and loyalty. Essentially, this means board members must exercise good business judgment in the best interests of the organization across governance, strategic, organizational, and operational processes without regard to personal gain as they:

• (Governance) Set broad policies and objectives and oversee rigorous processes taking into consideration compliance, finance, management, legal, and risk issues.
• (Strategic) Approve strategic plans, major expenditures and transactions, and the acquisition or disposal of material assets or the entity itself.
• (Organizational) Hire and fire the CEO. Approve top management appointments and succession, and compensation plans for the CEO and top management. Evolve and strengthen the board itself.
• (Operational) Approve ...