Directors are accountable for the overall management of a company and as such, they have the obligation of acting in the best interest of shareholders. However, boards must also take into consideration the interests and requirements of all stakeholders – including employees, customers, suppliers, communities, investors, and many more. This approach is referred to as stakeholder management. It’s one of the fundamental principles that are the basis of the ESG (environmental social and governance) movement which is revolutionizing the way companies are managed across the world.
A board of directors is a group of people who works together in order to achieve the goals of an organization. A well-functioning board of directors can play several roles, including establishing guidelines and providing guidance and support to management, and ensuring that the business is operating in accordance with its mission and vision.
A well-run board will seek out a variety of perspectives to better understand the specific challenges the company faces. They should also be able establish clear channels for communication between the board members and the stakeholders. This is not just an important aspect of corporate management, but it’s vital to build trust between the board and its stakeholders. Stakeholders are more likely to work with companies who are transparent and transparent about their reporting, because it demonstrates that the board taking its responsibilities seriously. It also helps build an image for the business and increase its value over time.
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