Board of directors

A group elected or appointed to oversee an organization’s strategy, management, and legal responsibilities. Its authority and duties depend on the organization’s governing documents and applicable law.

Fiduciary duty: A legal obligation to act loyally and carefully for another party’s benefit. Directors’ oversight is constrained by duties owed to the organization and, in some settings, its owners.
Director: A person who serves on an organization’s governing board. Directors exercise board authority individually through their roles and collectively through board action.
Audit committee: A board committee that oversees financial reporting, audits, and related controls. It gives directors focused oversight of financial statements and audit processes.
Board of trustees: A governing body, commonly used by nonprofits and institutions, whose members are called trustees. Trustee boards can perform similar oversight, but the title and legal duties vary by organization and jurisdiction.
Board diversity: The range of demographic, professional, and experiential backgrounds represented on a board. Composition can shape which perspectives inform oversight and strategic decisions.
Board committee: A smaller group of directors assigned to examine particular issues or perform delegated work. Committees let directors handle detailed oversight between full-board meetings.
Shareholder: A person or entity that owns shares in a company. Shareholders commonly elect directors and may have rights to approve major corporate changes.
Compensation committee: A board committee that oversees executive pay and related compensation policies. It helps directors evaluate and approve senior leaders’ compensation.
Advisory board: A group that offers advice to an organization without the formal governing authority of a board of directors. Its recommendations typically do not carry the binding authority directors exercise.
Corporate social responsibility: An organization’s consideration of its social and environmental effects alongside economic activity. Boards influence whether these concerns are integrated into strategy and accountability.

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