The Board of Directors is the governing body of a corporation. A corporation’s board is typically elected at each annual meeting of the shareholders for a term of one year.
The corporate charter and corporate bylaws outline the responsibilities and governance of the board. The board has many responsibilities, including but not limited to some of the following:
- Hiring the Chief Executive Officer (CEO)
- Helping define the company’s primary goals and overall strategy
- Declaring dividend distributions to shareholders
- Monitoring the financial and accounting activities of the corporation
- Approving a company sale or merger
A corporate board may have many separate titles. For example, it may consist of a chairperson, a vice chair, a treasurer, and a secretary. The organization’s CEO is often on the board and serves as chairperson; however, many organizations prefer not to have the CEO serve as a board member.