CG (Board & Management (Board - Governance- the work of the BODs or…
Board & Management
Board - Governance- the work of the BODs or other governing body
supervision of executive mgmt
inward looking & past present focus
monitor & supervise the activities of executive mgmt
Outward looking & future focused
board works with top mgmt
seeing the firm in its strategic external environment.
inward looking & future focused
Strategies then need to be translated into policies
accountability to shareholders & others
outward looking & past present focus
with legitimate claims to accountability
A board with a majority of executive directors
minority of non-executive
A board with majority of non-executive directors
many CG codes now demand this structure for listed companies.
Outside directors are expected to provide oversight & supervision of executive activities
non-executive not involve daily running bisnes
A board with only executive directors
top managers are also the director
small family firms & start-up businesses
A board with only non-executive directors
When board have this structure, the CEO & perhaps member of mgmt. team typically attend board meetings, but are there to provide information & to answer directors’ questions, not to be formally involved in the taking of decisions
not-for-profit entities such as charitable organizations
outside directors & mgmt. board (MB) entirely of executive directors
half - represent the interest of the employees
half - represent the interest of the shareholders
lower, mgmt. board or committee
Advisory board (advisory committee)
give advice to the corporate directors
other prominent figures
Representatives of non-shareholders stakeholders in the board
enhance not only corporate financial performance but also more important corporate social performance.
to protect the community over mgmt. and shareholders.
Mgmt - the work of the executive management team.
exercise of power over corporate entities.
stakeholders perspective - corporations are made responsive to the rights & wishes of stakeholders’.
Financial economics perspective - Their principal concern was with the ownership concentration in CG system around the world & the legal protection available to investors.
Relationship Perspective - the distribution of rights & responsibilities among the different participants in the organization
Societal perspective - holding the balance between economic & social goals & between individual & communal goal
Operational Perspective - an organization is directed & controlled.