Glossary
Definition
Board of Directors
A group elected by shareholders to oversee a company's management.
A board of directors is the governing body of a corporation, elected by shareholders. The board is responsible for setting strategic direction, hiring and firing the CEO, approving major financial decisions, and representing shareholder interests. Boards typically include both executive directors (company insiders) and independent non-executive directors.
Frequently Asked Questions
What is the difference between a CEO and a board member?
The CEO runs the company's day-to-day operations and reports to the board. The board sets overall strategy and governance and can hire or dismiss the CEO. Some CEOs also chair the board, which reduces the independence of board oversight.