The Pros and Cons of having a Board of Directors

One of the key roles of any board of directors is to provide effective governance.  On that basis the importance of a Board of Directors for a company cannot be understated.

Non-Executive Directors or Trustees need to understand their contribution to the success of the organisation as the Board is responsible for ensuring that the company runs in an ethical and legal manner.

The three tenets of corporate governance are (i) accountability; (ii) integrity and (iii) transparency with shareholders, executive management, and stakeholders.  They act as a check and balance on management.  In short, the Board is responsible for the company’s success or failure.

Although public and third sector organisations have different objectives to private sector organisations, they often face similar governance challenges.  Is therefore essential that different sectors adhere to its governance codes and frameworks.

Board of Directors act as a sounding board, making sure that decisions are made in the best interests of the shareholders or members.  The Board also brings together expertise and advice on strategic direction, ensuring your organisation develops and implements business plans, policies and procedures, strategies with profits and sustainability in mind.

There are absolutely no cons for appointing a Board of Directors for your company.  In fact, it doesn’t matter whether you are startup, scale up or well-established company.  It is essential that you appoint a Board of Directors to ensure that your strategy aligns with your purpose and mission.

If you would like to find out more about board duties and responsibilities; accountability to shareholders; decision-making; leadership; enterprise administration; statutory provisions and interests of third parties, please contact Inez Brown at McKenzie Brown Consultancy Ltd.