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Ceo Assignment

The document discusses the role and powers of a company's board of directors in corporate governance. It states that the board of directors, elected by shareholders, is vested with management powers subject to shareholder approval on certain matters. The board exercises standard powers like calling shares, borrowing money, and investing funds. An effective board delegates managerial duties while providing oversight, advice, and reviewing company performance to protect shareholder interests and ensure good governance.

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ANINDA NANDI
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92 views

Ceo Assignment

The document discusses the role and powers of a company's board of directors in corporate governance. It states that the board of directors, elected by shareholders, is vested with management powers subject to shareholder approval on certain matters. The board exercises standard powers like calling shares, borrowing money, and investing funds. An effective board delegates managerial duties while providing oversight, advice, and reviewing company performance to protect shareholder interests and ensure good governance.

Uploaded by

ANINDA NANDI
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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BOARD OF DIRECTOR

A POWERFUL INSTRUMENT IN CORPORATE GOVERNANCE


WHO IS A DIRECTOR?

Section 2(13) of the Companies Act defines a director as


follows:A director includes any person occupying the position
of director by whatever name called.
THE BOARD OF DIRECTORS
The board of directors of a company which includes all directors elected by shareholders to
represent their interests is vested with the powers of management.

The powers of the board of directors is co-extensive with those of the company subject to
two conditions:

(i) the board shall not do any act which is to be done by the company in general meeting
of shareholders and

(i) the board shall exercise its powers subject to the provisions contained in the Articles
or the Memorandum or in the Federal Acts concerned with companies or any
regulation made by the company in any general meeting.
POWERS OF THE BOARD

 Under Section 292 of the Companies Act, it is stipulated that a


company’s board of directors shall exercise the following powers
on behalf of the company by means of resolutions passed at the
meeting of the board:
 make calls on shareholders in respect of money unpaid on their
shares;
 issue debentures;
 borrow money otherwise;
 invest the funds of the company; and
 make loans.
The general meeting of shareholders is competent to take part and act
in respect of a matter delegated to the board of directors in cases
,
where
(i) the directors act mala fide;

(ii) the directors themselves are wrongdoers;

(iii) the board as a whole is found to be incompetent, when for instance, all directors
are interested in a transaction with the company;

(iv) there is a deadlock in management; and

(v) there is a fit case for the shareholders to exercise their residuary powers.
Resolution to invest the funds of the company
shall specify:
(i) The total amount up to which the funds may be invested and
(ii) The nature of the investments which may be made by the delegate.
Resolution delegating the power to make loans
shall specify:
(i) The total amount upto which loans may be made by the delegate;
(ii) The purposes for which the loans may be made; and
(iii) The maximum amount of loans which may be made for each such
purpose in individual cases.
Chief executive officer (CEO)

A chief executive officer (CEO) is the highest-ranking


executive in a company, and their primary responsibilities
include making major corporate decisions, managing the
overall operations and resources of a company, and acting as
the main point of communication between the board of
directors and corporate operations. A CEO often has a
position on the board; in some cases, she or he is even the
chair.
Roles and responsibilities of the CEO

The typical duties, responsibilities and job description of a CEO


include:
 Communicating, on behalf of the company, with
shareholders, government entities, and the public
 Leading the development of the company’s short- and long-
term strategy
 Creating and implementing the company or organization’s
vision and mission
 Evaluating the work of other executive leaders within the company,
including directors, vice presidents, and presidents

 Maintaining awareness of the competitive market landscape, expansion


opportunities, industry developments, etc.

 Ensuring that the company maintains high social


responsibility wherever it does business

 Assessing risks to the company and ensuring they are monitored and
minimized

 Setting strategic goals and making sure they are measurable and
describable
EFFECTIVENESS OF THE BOARD OF DIRECTORS

 The board of directors delegates most of its managerial power to chief


executives and executive committees.

 These committees and chief executives are considered more reliable

 Other than the stipulated functions, the board can play a realistic role in
the management by

 Confirming management decisions


 Providing constructive advice to the executives.

 Selecting chief executives and confirming the selection of other


executives in the company made by chief executives.

 Reviewing the results of the company’s current operations.


ROLE OF THE BOARD IN ENSURING CORPORATE
GOVERNANCE
 The board of directors is increasingly being recognized as a critical success factor for
corporations

 Company laws enacted by various countries make it a point to stress that the duty of a
statutory board is to protect and represent the interests of shareholders.

 The board cannot and does not run the company.

 The board is responsible to ensure that the management works in the best interests of
the corporation and the shareholders to enhance corporate economic value.
 no set of systems with a checklist and the laws of state governing them can ever
ensure good governance

 The quality of directors, their competence, commitment, willingness and ability to


assume a high degree of obligation to the company and its shareholders as
members of the board alone drives the value of any board.

 A strategic board with broad governing responsibilities has become the need of
an intensely competitive world.

 To strengthen their position and capacity to guide the company and protect the
long-term shareholder’s value, many big corporates are turning to advisory
boards to draw on the collective wisdom of several professionals.
Strategies that can help to ensure better governance
practices.

 Small size of the board


 Independence of the board
 Diversity of the board
 A well-informed board
 The board should have a longer vision and broader
responsibility
SOME PIONEERING INDIAN BOARDS

 Tata boards
 The shining example of Colgate Palmolive
 Board of Godrej Consumer Products and the CII
 Orchid chemicals’ bold board
SUMMARY
In today’s world, the corporate as a social entity, has to look beyond its
shareholders, to embrace all stakeholders and to perform its ethical and
social obligations to society through corporate governance practices. The
need to have proactive, socially conscious and upright board of directors
to guide and run corporations is keenly felt not only in the United States,
but also in developing countries like India and South Korea. Several
corporate bodies such as Tata Steel, ICICI, Orchid Chemicals are
examples that not only projects but also promotes corporate governance
practices all around them by their shining examples.

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