why a well managed business should have an independent board of directors in order to provide...

why a well managed business should have an independent board of directors in order to provide a strategic direction to business activities and to assist top management in meeting the objective of the business.

Expert Solution

A well managed business should have an independent Board of directors in order to provide a strategic direction to business because

1) The independent directors provides new and imporved ideas for the growth of the business.

2) The independent directors would able to pin-point the weakness of the management or company which the executive directors hasitate to point.

3) The independent directors can enforce a well capable management team to take-up the challenging projects which executive directors do not advice because of securing existing incomes.

4) The independent directors can well compare the company with the industry and ask the Board to aleast achieve the industry targets.

5) The independent board of directors can only invite more confidence in company from the general public or clients or customers.

Thus, it is always important to have higher quantum of independent directors in the Board of a company for its growth and valuation purpose.

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jeff jeffy answered 2 years ago

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