Boards play three primary roles they are to set policies, make important and strategic decisions, and oversee the organization’s activity. Well-written policies help a board focus its efforts, avoid repetition of efforts and ensure the necessary (but often thin) separation between management and oversight.
Effective boards should be able to identify and address emerging critical issues. To do this, boards should have access to as much precise and complete information as is possible. The information could include narrative reports on internal and program operations as well as narrative reports on budgets and expenses. It is essential for a board to be competent in communicating the story that is presented by these data.
Board members should be able discuss difficult and controversial issues, even if it creates tension within the group. It’s important for directors to have the freedom to challenge one another and play a variety of roles on the board – the ruthless cost cutter, the damn-the-details big picture guy, or the split-the-differences peacemaker. Being able to play different roles helps directors to have a better view of the options that the board has.
While it’s generally believed that good boards have board members with a significant amount of personal stake in the company However, research suggests that this is not an indicator of distinction. For example the boards of failed businesses and those of highly admired companies were roughly the same proportion of outsiders. The key appears to lie in the process of being able to discern and communicate the company’s strategy and risk and in the quality of dialogue and discussion.
http://www.toboardroom.com/create-a-healthy-working-balance-with-data-room-software
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