Boards may differ in size and composition, but they should all have a clear guidelines for the board’s responsibilities to ensure that members are held accountable. Board responsibilities typically include strategic leadership, managing financial stability, serving ambassadors and ensuring good governance.
Based on the type of organization, certain boards could have additional responsibilities like community partnerships and fundraising. However, the primary focus of a board is governing and overseeing the non-profit’s activities. The vast majority of nonprofit boards are volunteer who are not paid compensation for their efforts.
The board is not accountable for managing day-to-day business however, it is responsible for making important strategic choices, like mergers and acquisitions as well as high-level financial decisions. It also ensures that the company operates legally and in the best interest of shareholders and other stakeholders.
In addition to legal duties A board should also have a strong conflict of interests policy and an understanding of organizational documents (like bylaws, articles, and applications for exemption).
A solid board will work with stakeholders to understand their concerns, pursue necessary changes in corporate behavior and help develop the organization’s reputation in the community. Ultimately, the actions of the board are what determine the ethical standards of the organization. They are more important than any written ethical guidelines and reveal what the company truly believes. It is more essential than ever, in light of the recent controversy involving bribery.
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