Whether it is a public company, a non-profit organization, or a private company, the board of directors is responsible for protecting the interests of shareholders and investors in the company. It is important to note that public companies are legally bound to create a board of directors, while it is optional for NPOs and private companies.
The board of directors of a public company has bigger responsibilities on their shoulders. They have to protect investors’ interests and maintain a good relationship with the public.
Board of directors structure
The board of directors in a commercial organization has no defined structure, and the minimum or the maximum number of members can vary. For example, the companies listed in Russell 3000 have an average board size of 9. Similarly, S&P companies have a median board size of 11.
The roles and responsibilities are divided between the elected board directors. However, the usual structure in commercial boards consists of:
- President/CEO/Board chairperson
- Vice presidents
Roles and responsibilities of a board of directors in commercial organizations
As mentioned earlier, the board of directors is given the responsibility of protecting shareholders’ interests. That means directors need to make sure that the organization is on the right path to achieve its short-term and long-term goals. Here are a few primary responsibilities of the board of directors:
- Hiring the CEO of the company and defining their compensation
- Developing basic policies and guidelines for departments and employees of the company.
- Shaping a culture within the organization
- Maintaining goodwill in public and represent the company in the best possible way
- Constantly improving the strategic focus and effectiveness of the company
Board members divide responsibilities and assign tasks to all board members during board meetings. They may have to collaborate with company employees and business teams. Apart from that, the board’s internal communication and collaboration are vital to ensure effective corporate governance.
How board portal software helps boards of commercial organizations
Board portal or virtual boardroom software is a cloud-based digital platform that helps board members collaborate, communicate, store, and access board materials to perform their corporate duties.
The board software has achieved immense popularity in the corporate sector because of changing work practices and an increase in cross-border or cross-continent business acquisitions. Employees and professionals now prefer online channels for business meetings and communication. Here is how virtual board software can help.
1. Secure and quick access to board material
Decision-making is more like a routine job for board members, and for that, they need access to board material like strategic plans, past meeting agendas and minutes, policy manuals, financial statements, audit reports, orientation materials, etc., to make better and effective decisions.
Board management software helps corporate boards in storing board material in one place, which is accessible remotely. Board members can access and upload documents in the boardroom from anywhere, anytime, using their mobiles, tablets, or laptops.
2. Enhanced board members’ engagement
Traditionally, board members’ engagement was limited to board meetings and occasional emails when needed. However, the board portal has changed that completely. Board members can use discussion boards to discuss important affairs or engage in private chats. They can start polls and cast votes, assign tasks, and arrange urgent mini-meetings whenever necessary.
Apart from that, board members can create, edit, share and annotate documents. They can work on shared documents and make changes in real-time. Regular communication, group discussions, and direct messages can reduce the need for frequent board meetings.
3. Streamlined online board meeting
Being able to conduct an online board meeting not only saves a lot of time but it helps save money. Board portal softwarecan help board administration streamline online board meetings. From creating meeting agendas using boardroom templates to conducting online board meetings to dispersing meeting minutes, everything can be easily done in board portal software.
4. Document access control and data security
Virtual boardrooms not only help boards store data but also keep it safe from cyber threats. Boardrooms are enriched with cutting-edge security features that provide maximum protection. Any unauthorized entry into the boardrooms is restricted with the help of two-step verification and multi-factor authorization.
Similarly, virtual boardrooms have document security features, including document access control, digital watermarking, fence view mode, and document access revocation. Board members and administrators can decide who is and isn’t allowed to access, edit, download, or print documents.
As a board portal is a paperless meeting solution, it helps company boards save a massive amount of funds spent on paper, printing, and online meeting expenses. Paper and printing costs are some of the major administrative expenses that can be minimized with board portals. Moreover, conducting online board meetings helps save the traveling expenses of board members.
The board of directors is handed over a massive responsibility of steering the organization in the right direction and protecting shareholders’ interests. Virtual boardrooms help board members perform their duties in an efficient way. Boardrooms streamline board documentation and meetings, ensuring seamless collaboration.