As a governing body the board of directors make strategic decisions based on reliable data and decides on the future for an enterprise. The role of the board is to guide the direction of the company and to make decisions that are aligned with the company’s goals, mission, and vision. However, a well-structured board is more than an instrument for management.
The ability of the board to make decisions can be significantly affected by the manner in which it is formed. Board members must be equipped to bring a variety of knowledge and experience to the table so that they can offer new perspectives. This opens up new avenues for the business. One of the best ways to achieve this is by encouraging diversity in the composition of boards. A absence of diversity in the boardroom could lead to a narrow view of the company’s role in the society and its optimal future direction.
Straw polls can be used to improve board decisions. This method involves voting in a way that doesn’t count, then explaining your vote. This can help to bring about a more focused discussion of the issue, and help inform the final formal and binding vote.
Boards can also reduce decision fatigue by restructuring the agenda to place important decisions earlier and more important pro forma items at the end of the meeting. This lets the board take its time and avoids the detrimental effects of fatigue.
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