Design of the Board of Directors
The Boards of Directors should not all be the same. That is why there are no universal guidelines.
A Board of Directors must be considered and designed specifically for each company and for each employer, depending on aspects such as: its volume of operations; the complexity of their processes; their type of financing needs; the business dependence on R&D; the level of internationalization; the importance on digital; their development plans; ambitions; its shareholding structure; type of conflicts; their proximity to some kind of corporate transaction, etc.
It seems obvious that a design that takes into account all these parameters will be much more focused on the value contribution than the application of any general stereotype.
The specific design for each company will depend on their specific needs, future plans and problems to solve and the reality of the company.
When designing a Board of Directors, we must consider the following aspects of how the Board should be and function:
- Size that the Board should have.
- Type of board members (proprietary shareholders, independent, executives).
- Professional profile of the board members.
- Regulations for the functioning of the Board.
- Number of times the Board will meet each year and the duration of these meetings.
- Information that the Board members must receive in advance and when this must be available.
- Compensation of Board Members.
- Mechanisms to review the functioning of the Board and the contribution of each board member.
- Rotation of board member.
- Maximum number of years that a board member should exercise as such.
- Periodic Review of the Board.