"Board room" and "board of trustees" redirect here.

For other uses, see supervisory board, board

room (disambiguation), and board of trustees (disambiguation).

A meeting of a board of directors of the Leipzig–Dresden Railway Company in 1852

A board of directors is a group of people who jointly supervise the activities of an organization,
which can be either a for-profit business, nonprofit organization, or a government agency. Such a
board's powers, duties, and responsibilities are determined by government regulations (including
the jurisdiction's corporations law) and the organization's own constitution and bylaws. These
authorities may specify the number of members of the board, how they are to be chosen, and
how often they are to meet.
In an organization with voting members, the board is accountable to, and might be subordinate
to, the organization's full membership, which usually vote for the members of the board. In
a stock corporation, non-executive directors are voted for by the shareholders, with the board
having ultimate responsibility for the management of the corporation. The board of directors
appoints the chief executive officer of the corporation and sets out the overall strategic direction.
In corporations with dispersed ownership, the identification and nomination of directors (that
shareholders vote for or against) are often done by the board itself, leading to a high degree of
self-perpetuation. In a non-stock corporation with no general voting membership, the board is the
supreme governing body of the institution, and its members are sometimes chosen by the board
itself.[1][2][3]

Contents

 1Terminology
 2Roles
 3Directors
o 3.1Inside director
o 3.2Outside director
o 3.3Terminology
 4Process and structure
o 4.1Board meetings
o 4.2Size
 5Non-corporate boards
o 5.1Membership organizations
 6Corporations
o 6.1Governance
o 6.2Two-tier system
o 6.3History
o 6.4Election and removal
o 6.5Exercise of powers
o 6.6Duties
 6.6.1"Proper purpose"
  6.6.2"Unfettered discretion"
 6.6.3"Conflict of duty and interest"
 6.6.3.1Transactions with the company
 6.6.3.2Use of corporate property, opportunity, or information
 6.6.3.3Competing with the company
 6.6.4Common law duties of care and skill
 6.6.5Remedies for breach of duty
 6.6.6Current trends
 6.6.7The Board and Society
o 6.7United States
 6.7.1Sarbanes–Oxley Act
 6.7.2Size
 6.7.3Committees
 6.7.4Compensation
o 6.8Criticism
 7See also
 8Notes
 9References
o 9.1Citations
o 9.2Sources
 10External links

Terminology[edit]
Other names include board of directors and advisors, board of governors, board of
managers, board of regents, board of trustees, or board of visitors. It may also be called
"the executive board" and is often simply referred to as "the board".[4]

Roles[edit]
Business administration

Management of a business

Accounting[show]

Business entities[show]

Corporate governance[show]

Corporate law[show]

Corporate title[show]

Economics[show]
 Finance[show]

Types of management[show]

Organization[show]

Trade[show]

 Business and economics portal

 v
 t
 e

Typical duties of boards of directors include:[5][6]

 governing the organization by establishing broad policies and setting out strategic objectives;
 selecting, appointing, supporting and reviewing the performance of the chief executive (of
which the titles vary from organization to organization; the chief executive may be titled chief
executive officer, president or executive director);
 terminating the chief executive;
 ensuring the availability of adequate financial resources;
 approving annual budgets;
 accounting to the stakeholders for the organization's performance;
 setting the salaries, compensation and benefits of senior management;