Board of Directors – What is it, definition and concept | 2022

The board of directors is the highest governing and administrative body of an association and acts in accordance with the statutes of this entity. In addition to its management role, it is also the representative body.

The board of directors is a collegiate body that is responsible for managing and designing the strategy of an association so that it reaches the objectives established by its statutes. For it to be understood that there is a board of directors there must be at least a president, a secretary and a treasurer. Without these three appointments there will be no board of directors.

The board functions in both commercial and civil associations, and is appointed by the general assembly. In commercial companies, the meeting is known as the board of directors.

Functions of the board of directors

The functions performed by this collegiate body are:

  1. Define the strategy to achieve the objectives established in the statutes.
  2. Control the execution of these strategic plans. You must present a management balance before a proposal for action.
  3. Establishment and control of budgets.
  4. Decision making.
  5. Review partnership results and budgets.
  6. Corporate operations.
  7. Terminate members of management and high-ranking employees.
  8. Decision-making by all shareholders is necessary at the meeting.
  9. The board must bear the responsibility for the management of the association.
  10. It occupies the representation of the association before third parties and its own partners.
  11. The members of the board of directors can receive fees for their work, as long as they do not originate from the public subsidy.
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Composition

Who forms the board of directors?

  • President: direct and represent. Summons the meetings of the board or general assembly. Review the documents of the secretary and treasurer.
  • Vice president: support for the presidency and substitution of the president in his absence.
  • Secretary: drafts and signs the minutes of the general assembly and the board.
  • Treasurer: prepares the budget, the balance and the liquidation of accounts and keeps the accounting books.
  • The figures of the secretary, treasurer and president are mandatory figures to establish the board. Instead, the figure of the vice president is optional.

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Elena Trujillo, April 04, 2022
Board of Directors. Economipedia.com

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