Perhaps this is the natural conclusion from the several insights previously explored.\u00a0 While the CEO and management offers the vision, strategies and tactics as well as the proposed budget, it is the board that controls with its votes the execution of strategy, the expenditure of cash, the taking on of debt or new equity, the very direction of the company as well as its ultimate health.<\/p>\n
The most important person in a corporation usually is and should be the CEO. This person, often the founder in early stage companies and beyond, is the originator and keeper of the vision, leading all others below and the board above as willing believers in the vision advanced.\u00a0 But the board is responsible for providing resources to fulfill that vision, which may include new cash infusion or assumption of new debt.<\/p>\n
In extreme situations, it is the board that must step up and replace the CEO, assuming the responsibility for finding and integrating a new leader quickly and efficiently.\u00a0 Sometimes this means having a board member step in for a short time as CEO for continuity.<\/p>\n
Recently, one of the CEOs in a roundtable who had been active and vibrant for years in both his company and the roundtable, died suddenly of a heart attack.\u00a0 His board met in emergency session and managed a smooth transition to a new leader within a month, during the most traumatic of times for all employees and the board itself.\u00a0 \u00a0For non-profit boards, the two most important duties under the duty of loyalty and care are the oversight and eventual replacement of the CEO, and maintenance of the entity over its infinitely long lifetime.\u00a0 I have been member and even chair of presidential search committees, and can attest that board members (and other designated stakeholders) spend hundreds of hours in the recruiting process, all without pay.<\/p>\n
It is because the continuity provided by the board is the one thing shareholders must count on above all else to protect investment, that the board rises in importance to at least equal stature as the executive cohort.<\/p>\n","protected":false},"excerpt":{"rendered":"
Perhaps this is the natural conclusion from the several insights previously explored.\u00a0 While the CEO and management offers the vision, strategies and tactics as well as the proposed budget, it is the board that controls with its votes the execution … Continue reading