In the past, many company boards were made up of retired outstanding members of society who were not necessarily deeply knowledgeable about the company’s business.
Some were simply invited to be board members because of their success elsewhere and were therefore regarded as high standing members of society. This is not the case anymore. Board members in the 21 Centuary are expected to have a given skill set and add considerable value to an organisation.
A board is appointed by the company stakeholders to protect their rights and sets goals that management must implement.
According to the National Water and Sewerage Corporation board chairperson Chris Ebal, the main duty of a company board, is to ensure corporate governance.
Ebal says the board has to guide corporate strategy, objective setting, and major plans of action, select, compensate monitor and replace key executives and oversee succession planning.
He says anybody aged between 21 and 72 years, can be appointed to a board as long as they have the competences, qualifications and qualities which allow them to act as a catalyst within the changing and competitive global market.
“A board member should have the ability to make sensible astute business decisions, be entrepreneurial, have the ability to see the wider picture, have a high levels of integrity, awareness, and have the ability to interprete financial statements and statistical information such as balance sheets, profit and loss accounts,” Ebal adds.
Set goals and objectives
According to Medard Bityekerezo, the board chairperson National Medical Stores, when they (the current board) took over the oversight of the institution, they decided that whenever the board sat, they would have to come up with actionable resolutions.
Board members had to be trained in corporate governance to understand key aspects such as setting a strategic plan for the company, understanding what stakeholder and financial management entail. This enabled them to establish procedures in line with the rule of law.
Samuel Sejjaaka who chairs the boards of UAP Old Mutual, African Queen and the Investment Advisory Committee on Oil Revenue, observes that most boards fail to deliver because the members are not adequately trained.
He says it is difficult to get individuals with all the skills required on board but that it is important for members to acquaint themselves with the skills of the company business they represent.
“Every board member should have fiduciary skills which include good governance, accounting, financial, legal and ICT skills and this combined with the different skillsets of the other board members, brings value to the board and company.