As stewards of the company’s mission, board members ensure the overall success and sustainability of the enterprise. Board members play a crucial role in corporate governance, guiding strategic decisions, fostering accountability, and shaping the organization’s destiny.
Time is a precious commodity for CEOs and executives, especially during board meetings, making meeting software a valuable tool to streamline board governance. Whether a virtual conference or an in-person gathering, board management software enables board members to communicate effectively, access key documents, and vote on important measures.
What is a Board Member?
A board member serves on an organization’s board of directors. The board of directors is responsible for overseeing the organization’s overall management and strategic direction. Board members are elected or appointed by the shareholders or stakeholders of the company, depending on its legal structure.
Some board members serve on the executive board, and they often have additional responsibilities, such as overseeing the organization’s executive team, setting performance goals for senior management, and evaluating executive performance.
Board members may serve voluntarily, but some receive compensation for their services. They’re expected to bring their expertise and independent judgment to the board; actively participate in meetings, committees, and discussions; and contribute to the collective decision-making process.
Board Member Titles
Within a governing board, synonymous with a board of directors, board members may hold several titles and roles. These positions are essential for ensuring the organization’s smooth operation.
Some of the common titles and their roles within a board of directors include:
- President: The president is the highest-ranking officer on the board of directors. The president provides leadership and guidance to the board, presides over board meetings, and often acts as the organization’s primary representative.
- Vice President: The vice president serves as the second-in-command to the president. The VP may assist the president in their duties, fill in while the president is absent, or take on specific responsibilities assigned by the board.
- Secretary: The secretary ensures meeting minutes are properly recorded and distributed to board members, maintains the organization’s bylaws and governance documents, and handles necessary legal or regulatory filings.
- Treasurer: The treasurer oversees the organization’s financial matters and provides financial guidance to the board. They monitor the organization’s financial health, review budgets and financial reports, and ensure compliance with financial regulations.
- Emeritus board members: They act as trusted advisors, providing mentorship and guidance to the current board members and executive team.
The titles and responsibilities may vary depending on the organization’s bylaws, industry, and jurisdiction. Some organizations have additional positions like executive director, committee chair, or specific functional roles like governance chair or audit committee chair.
Board Member Responsibilities
Board members hold various roles and responsibilities that contribute to an organization’s success. The standard responsibilities for board members typically include:
1. Hiring and setting compensation for executive leadership
The board of directors evaluates candidates, ensuring their qualifications align with strategic goals and organizational culture. They determine the compensation packages for executives, including salaries, bonuses, stock options, and other incentives.
2. Adopting policies to address conflicts of interest
Board members, like ex officio members, are responsible for ensuring transparency, integrity, and fairness in decision-making processes, especially when personal interests intersect with the organization’s best interests.
Ex officio board members—who hold their positions by virtue of another role within the organization—bring valuable perspectives and expertise. By adopting clear policies, the board sets expectations for identifying, disclosing, and managing conflicts of interest among board members, executives, and other key individuals.
3. Shaping the organization’s culture and vision
The board of directors establishes and upholds ethical standards that guide the behavior and actions of the organization’s stakeholders to foster a culture of integrity, transparency, and accountability.
In addition, they ensure compliance with legal and regulatory requirements to safeguard the organization’s reputation and minimize potential risks.
4. Improving the organization’s strategic focus and effectiveness
Board members engage in strategic planning by assessing the organization’s current performance, identifying areas for improvement, and setting strategic goals and objectives.
Also, board members bring independent judgment, challenge assumptions, and foster critical thinking. They assess risks and opportunities, evaluate potential initiatives, and provide recommendations to enhance the organization’s effectiveness and adaptability in a dynamic and evolving environment.
Traits of an Effective Board Member
Effective board members typically possess the following traits that help fulfill their responsibilities and make valuable contributions to an organization.
- Commitment: They demonstrate dedication and actively engage in board activities, attend meetings, participate in discussions, and fulfill their responsibilities.
- Integrity: Board members must exhibit high ethical standards and serve as role models for the organization and its stakeholders.
- Accountability: Effective board members follow through on commitments, meet deadlines, and are accountable for their actions and decisions.
- Leadership and influence: They inspire others, motivate stakeholders, and advocate for the organization’s mission and goals.
- Continuous learning: Effective board members stay informed about industry trends, best practices, and emerging issues relevant to the organization.
These traits collectively contribute to the effectiveness of board members in carrying out their fiduciary duties, providing strategic guidance, and driving the organization toward its goals.
OnBoard Powers Effective Boards
OnBoard is a powerful software solution that addresses modern board needs, transforming how boards conduct meetings, manage documents, and communicate.
Board portal software provides a centrally managed, highly encrypted software solution to simplify access to meeting materials, such as the agenda and meeting minutes. Board portal software also enables virtual meetings and improves communication, allowing board members to engage from anywhere.
Check out OnBoard’s free board meeting agenda template for a small taste of what the software can do for your board of directors.
Frequently Asked Questions (FAQ)
1. Who Appoints Board Members?
The process of appointing board members can vary depending on the organization. However, board members can be appointed by shareholders, stakeholders, or other board members.
2. What Are Board Member Term Limits?
Term limits specify how long a member can serve on a board. They can include cumulative, fixed, or no-term limits.
3. Are Board Members Paid?
Depending on the organization and its specific policies, board members may or may not receive compensation for their service.
About The Author
- Gina Guy is an implementation consultant who specializes in working with nonprofit organizations get the most from their board meetings. She loves helping customers ease their workloads through their use of OnBoard. A Purdue University graduate, Gina enjoys refinishing furniture, running, kayaking, and traveling in her spare time. She lives in Monticello, Indiana, with her husband.
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