( strategic management ) When does a corporation need a board of d directors?

Expert Solution

When a company is incorporated it must have board of directors. Appointing board of directors is the most important task in incorporating a company. It is a group of individuals who are responsible for the smooth running of the corporation. A board of directors is an elected group of individuals that represent shareholders.

Board of directors are required to take decisions on behalf of shareholders. They are independent of the company but are known for their business abilities.

In following are main examples when corporation needs board of directors

Approve the company's financial statements
Taking decision regarding acquisitions and mergers
Dividend payment decisions
Formulation of Mission, Objection and policies
Designing organisational structure
Selection of top executives
Financial sanctions
Evaluate the performance of CEO
formulation, implementation, evaluation and reformulation of strategies by constituting various committee and help in policy making.

jeff jeffy answered 2 years ago

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