Corporate Boards
The board is accountable for overseeing a company and ensuring that it is operating legally and in the interests of its shareholders and other stakeholders. It also functions independently from company management and day-to-day operations.
Over the past decade, boards have shaken off their reputation as a gang of powerful insiders who work only to make money and are reluctant to fire CEOs. Instead, they’ve evolved into advisory teams, like coaches for players who are able to manage this hyperlink multiple pressures, from traditional demands like increasing revenues and establishing strong leadership succession plans to newer ones like shrinking the carbon footprint of a business and increasing social equity.
How do today’s top board members navigating the avalanche of risks and the whirlwind forces shaping our economy’s future? To answer this question, Fortune surveyed board members and analyzed the data of a range of companies. Although we couldn’t find a board that was fully representative of a modern model the most successful boards shared a number of fundamental traits.
Diverse board of directors
The COVID-19 epidemic taught boards that it’s ever more important to have a range of perspectives and backgrounds in the boardroom, to help in guiding strategy and weather emergencies. Directors said that the most effective boards are those that have a culture of trust and transparency and they are committed to staying up-to-date on their knowledge through ongoing learning and training.
The most active boards take a more hands-on approach to their responsibilities and have fewer committees assigned to them, which helps preserve the necessary line between the role of the board and management. They also aim to increase their financial literacy and be more aware of the technology they employ as well as the latest advancements in cyber security, and other issues that businesses have to deal with today.
