Boards are legally required to exercise their due diligence in ensuring that an organization achieves its objectives, has a sound strategic plan and does not get into financial or legal issues. The manner in which boards are required to fulfill these obligations is different and highly dependent on the circumstances.
A common error is that boards become too involved in operational issues which should be left to management, or that they are not clear about their legal obligations for the decisions they make and the actions they make on behalf of the company. This confusion usually results from not keeping up with changing demands placed on boards or from unanticipated problems like unexpected staff resignations or financial crises. Usually, this can be remedied by taking time for discussion of the issues faced by directors and by providing them with orientation and simple written materials.
Another common error is when the board is able to delegate too much authority and does not scrutinize the tasks it has delegated. (Except in the smallest NPOs). In this scenario, the board loses its ability to evaluate and no longer determine if these operational activities contribute to a satisfactory performance of the organization as a whole.
The board must also develop a governance system including how it interacts with the general manager or CEO. This includes the decision-making process for the frequency of meetings, how members will be selected and removed, and how decisions will take place. The board must also create information systems that offer valid information on the past and future performance in order to assist in making its decisions.
read this post here – cut costs with smart data room tariffs