INTRODUCTION

Generally, it is common to see a group of people that are elected in public

company as Board of Directors (BOD) where these groups of people will act as
representatives or make decisions on major company issues and approve any relevant
related policies on behalf of the shareholders or stakeholders of the company. That being
said, it is crucial for the act or decisions made by the board of directors being fair in both
shareholders and companys interest as failing to do so might cause unbeneficial
decisions that could jeopardize the companys goodwill and performance.
OBLIGATION OF BOARD OF DIRECTORS
I) APPOINT CHIEF EXECUTIVE OFFICER (CEO)
One of the few crucial responsibilities that board of directors need to take into
account will be electing and appointing the suitable candidate as the CEO of the company
at the time of annual meetings. In order to be effective, the board of directors will only
approve and appoint one who possesses high integrity, good leadership skills and
qualities and highly motivated to implement profitable strategies to the company. Upon
appointing a CEO, the CEO of the company will have specific responsibilities and their
job description will vary depending on what the company needs but the CEO will need to
oversee the complete operation of the company with the direction established from
planning and report to the Board of Directors on the performance of the implemented
approved policy in order to evaluate the success of the company.
Besides that, the board of directors will always ensures that they communicate
board approved policies and vision designed to achieve objectives and goals of other
shareholders and stakeholders in the company after the CEO selection process. By doing
so which the CEO is allowed to operate and execute the defined strategies and policies to
manage the day to day operations of the company by creating, communicating and
leading other members of the company to success.


II) DEVELOP POLICIES AND CONTROLS
The board of directors will also establish effective system of control and
objectives in the company through limitation, policies and verification functions. That
being said, executed policies should always be align to the strategy set by the board of
directors while daily operations are conducted accordingly to the board approved policies
and this will ensure that decision making authority are done in proper level to ensure
decisions and policies are properly implemented. It is crucial for the company to run in a
systematically way so that the company conforms to the legal, moral and ethical
standards.
III) ENSURING SUFFICIENT RESOURCES TO SUSTAIN
Another obligation of BOD is to ensure there are sufficient income and resources
in order to maintain the company growth. To be effective, BOD are expected to raise
money and only approving necessary budgets to ensure appropriate amount of resources
are available for the CEO to run the company. This may involves monitoring capital
resources and human resources to support the CEO in implementing strategies. CEO will
also take suggestions and opinions from BOD on the possible emerging challenges and
market trends which will improve the overall decision making efficiency.