Roles and Responsibilities of Chairman of Board of Directors

Masters
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Miscellaneous
Pages 5 (1255 words)
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monitoring progress towards the timely and effective achievement and implementation of the objectives, policies and strategies set by the Board and of other decisions taken by or on behalf of the Board

Introduction

nly helps in distributing the balance of power and responsibilities. Board is the primary internal control mechanism for aligning the different interests of shareholders and top management. When an individual serves simultaneously as chairman and CEO, the Board's control over him will be weakened. This does not happen when the roles are separated.The role of Chairman includes managing the business of the Board and monitoring its progress. Non-segregation of duties of Chairman and CEO would reduce the monitoring effectiveness over the management of the company.Opportunistic executives may take advantage of their combined role as Chairman and CEO in order to personally benefit at the expense of the shareholders. The chances of such injustice would reduce to an extent if the roles are separated.Having a single leader instead of two helps promote effective action by the CEO speeding up response to external events faced by the company. Separation of roles could lead to delays in such response.(iv) ...
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