On high-performance board in Corporate Governance

Based on A. de. Kluyver (2009), I formulate the following discussion agenda on High-Performance Board in Corporate Governance study:

1. Board of Directors' main duties:
• provide oversight
• direct the company's affairs as defined by law
• Directors' individual and collective motivation and capabilities
2. Characteristics of an effective board
• Contribute to strategic thinking and feel a strong sense of strategy ownership
• Build the top executive team
• Link reward to performance, with balanced short-term and long-term focus
• Focus on financial viability
• Match risk (e.g. operational risk) with return
• Manage corporate reputation by focusing on transparency and effective communication
• Set the tone from top and implement an effective governance model
3. Board leadership based on right leadership: considerations of a nonexecutive chair or the lead director model
4. Key responisibilities of a chair
• Manage the board
• Maintain communication with others, e.g senior management
• Play a leading role in CEO succession planning
• Evaluate board and resolve conflicts
5. The concern of a heightened sense of role ambiguity and role conflict of the board
6. Evaluate the formal and informal rules on group behavior and individual behavior of board
7. Barriers to board effectiveness:
• Time and information deficits
• knowledge on the company's financial results and competitive positions
• knowledge on the company's culture and customers'/ employees' feeling about the company
• Need to monitor the company's compliance with legeal and ethical standards
• Need to monitor business unit peformance wiht dashboards and scorecards
• Need to access external advisors
8. Build the right board composition
9. Self evaluation of board with, for examples, (i) the audit committee, and (ii) checking to ensure the board's qualification are acceptable to the company.

References

1. A.de. Kluyer, C. (2009) A Primer on Corporate Governance, Business Expert Press. [Chapter 10: Creating a High-Performance Board]
2. On corporate governance: http://en.wikipedia.org/wiki/Corporate_governance