There are a variety of views about the roles and responsibilities of a board of directors and most of these views share common themes. This document attempts to portray those themes by depicting various views. Simply put, a board of directors is a group of people legally charged with the responsibility to govern a corporation. In a for-profit corporation, the board of directors is responsible to the stockholders -- a more progressive perspective is that the board is responsible to the stakeholders, that is, to everyone who is interested and/or can be effected by the corporation. In a nonprofit corporation, the board reports to stakeholders, particularly the local communities which the nonprofit serves.
Major Duties of Board of Directors
Brenda Hanlon, in In Boards We Trust, suggests the following
duties.
Provide continuity for the organization by setting up a corporation or legal existence, and to represent the organization's point of view through interpretation of its products and services, and advocacy for them.
Select and appoint a chief executive to whom responsibility for the administration of the organization is delegated, including:
to review and evaluate his/her performance regularly on the basis of a specific job description, including executive relations with the board, leadership in the organization, in program planning and implementation, and in management of the organization and its personnel/
to offer administrative guidance and determine whether to retain or dismiss the executive
Govern the organization by broad policies and objectives, formulated and agreed upon by the chief executive and employees, including to assign priorities and ensure the organization's capacity to carry out programs by continually reviewing its work
Acquire sufficient resources for the organization's operations and to finance the products and services adequately
Account to the public for the products and services of the organization and expenditures of its funds, including:
to provide for fiscal accountability, approve the budget, and formulate policies related to contracts from public or private resources
to accept responsibility for all conditions and policies attached to new, innovative, or experimental programs.
Major
Responsibilities of Board of Directors
BoardSource, in their booklet "Ten Basic Responsibilities of
Nonprofit Boards", itemize the following 10 responsibilities for nonprofit
boards.
1. Determine the Organization's Mission and Purpose
2. Select the Executive
3. Support the Executive and Review His or Her Performance
4. Ensure Effective Organizational Planning
5. Ensure Adequate Resources
6. Manage Resources Effectively
7. Determine and Monitor the Organization's Programs and Services
8. Enhance the Organization's Public Image
9. Serve as a Court of Appeal
10. Assess Its Own Performance