A board of directors is an organization’s group of individuals who oversee strategic planning and decisions in line with the company’s objectives as well as its vision, mission and values. The board is responsible to balance shareholders’ interests while maintaining integrity, as well as planning for the future of the company.
A subset of the board, the executive committee handles urgent issues and serves as a steering committee for the board. It usually consists of an executive secretary, treasurer vice-chairperson and chairperson. The chairperson is typically the CEO and leader of the committee. the vice chairman assists the chairman and serves as their second in command when they are away. The secretary keeps minutes, manages the calendar of committee members and ensures everyone has access to important documents.
A small group is the design of an executive committee. They are more flexible and be able to meet with short notice in order to make decisions in an emergency. This allows the whole board to focus on larger issues during their regular meetings.
An executive committee can also handle a variety of routine issues and serve as an interim company in situations that the board is not required to be present, like standard legal or financial procedures. It is also a way to test controversial ideas and to examine how the company responds to them before bringing it to the entire board. The committee should not be considered a second-tier power structure. It’s best to have clear delegated power as well as internal checks and checks and balances.
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