![]() ![]() Once the board has delegated broad authority, its primary responsibility is to oversee management’s performance (while attending to areas that are not delegated to management, such as governance matters, CEO compensation and succession, retention and oversight of the independent auditor, approval of major transactions, determination of dividend payments, and bylaw amendments).īoard oversight involves the continual inquiry by directors into whether the board’s delegation of authority to management is reasonable, and whether the board has received sufficient and accurate information from management to make that determination. While the board is responsible under state corporate law for the direction and management of the company, it typically delegates significant authority to the CEO and senior management to run the business. Board-management relationships and board culture.Corporate purpose and environmental, social, and governance (ESG) matters.This post summarizes directors’ duty of oversight and highlights issues that are likely to require significant board attention in 2022, including: Companies face pressure on multiple fronts, including resistance to returning to in-person work in a highly competitive talent market, supply chain bottlenecks and inflation, the potential for a global and national economic slowdown, and increasing risk of cyberattacks, unusual climate events, and regulatory action (including antitrust enforcement and taxation), all in an atmosphere of heightened scrutiny of board oversight.Įnsuring that directors are well-positioned to satisfy their oversight responsibility requires periodic assessment of board agenda priorities and the related structures, processes, and controls that are in place to ensure that the board is well-informed on a timely basis of matters requiring attention. The challenges of operating through the COVID-19 pandemic in an uncertain environment continue to be felt as companies anticipate a new post-pandemic normal. ![]() Boards function in a complex and dynamic business setting in which stakeholder expectations and demands for board attention are expanding. ![]()
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