The communication between the director and board members has become a standard practice in a corporation. It is because of risks and impacts made when the head of the firm has to wait till to the development of an issue before considering involving investors or board members of the enterprise. The communication aspect will enable the Chief Executive Officer to hear views which are not varnished from the board members. On the other hand, investors will be able to know the philosophy of the board and its perceptiveness about particular governance and issues which are strategic. The LifeSci Advisors firm has a board which meets from time to time to craft the vision of the company.
Craft the vision of the company
It has been reported that majority of directors of organizations do not like participating together with the members of the board whenever an issue arises. Most of them are afraid of the risk of the possibility of Regulation Fair Disclosure being violated. There is also a small percentage of directors who believe that the board members are not allowed to carry out the role of investor relations in a company. They insist that investor relation is the role played by the management team of the firm and IRO (Investor relations officer). The primary responsibility of investor relations officer is to share all important board members’ insight for them to be considered in a meeting within the agenda of the board which is to be discussed.
Correct one another
During these board meetings, a director is allowed to correct a member of the council in case he or she oversteps his or her mandate in the interference of the day to day running of an organization. In some cases, Chief Executive Officers are not for the idea of the directors of the company engaging with the investor or having direct contact with them. It is because of the unfair access whereby a manager may prefer an investor who is investing mostly and an investor who is investing his or her small amount of money in the business is likely to be completely ignored.
There are some situations in an organization; directors willingly allow the inclusion of board members in investor relation meeting so that decisions and solution can be found as soon as possible. In a case whereby the compensation of the Chief Executive Officer has got unresolved issues, the chairman of the board will be included in the meeting so that he or she will be required to explain in details the compensation program’s philosophy. In cases, the director is under siege, the chairman of the board is the right individual to offer explanation.