PUSHP OJHA

This study entitled “roles and responsibilities of Board of directors in corporate governance” studies the various roles that are performed by the board of directors for sustainability of corporations. How directors are very crucial body for ethical business operation and how BOD roles affect financial performance. The study is mainly based on different articles about the role of board of directors. From reviewing the articles, we find that board of directors are most considerable body of organization and their role affect the pattern of doing activities on it. Board of directors play a significant role from formulating of strategic plans to monitoring activities and guiding different managers of the organization. Board of directors are involved in formulation of long-term planning so; their interest largely affects the performance of the organization. Board of directors are not only involved in formulation process but they appoint CEO, Determine the compensation of senior managers, dividend decision, provide advice and guidelines to the senior managers etc... Board of directors directly or indirectly influence every decision of organization so, they must be well educated, skilled and qualified according to the nature of the organization. The active Board and high participation result in increase in the financial performance of the organization. According to the study good corporate governance is affected by size and composition of directors in board. For being apex decision maker of company BOD must continually ensure best practices of corporate governance and continuously monitor that the organizations activities are performed in ethical manner and company is always on right direction. In large organization larger board size with higher independent directors results in better financial performance. Also board diversity and board capital have impact on performance.
Keywords: Board of director, Monitoring and guidance, skills and education of board, financial performance,