The board of directors is the most powerful the governing body of a business. The board is accountable for the goals of the organization and the decision-making processes. The board of directors is comprised of senior leaders who are appointed or elected by members. The board’s powers, duties and responsibilities are governed by government regulations and the corporation’s constitution and by-laws.
An executive committee is a smaller, more intimate group with close ties to the management, who can gather at short notice to discuss pressing issues that affect the organization and then bring them to the board’s attention. Depending on the company’s structure and bylaws, the executive committee may have the data breaches same responsibilities as the board of directors, or it could have a smaller role.
Typically, the executive committee is made up of the chairperson, vice-chairperson, and treasurer of the board. The chairperson also acts as the spokesperson for the business and ensures that all board and committee activities are aligned with its mission. The executive committee is a good option when an organization requires quick action to resolve issues that are repetitive or have controversial ideas, as this group is able to review and approve these matters before bringing them to the board in its entirety.
It is crucial, however, to ensure that the committee doesn’t assume decision-making responsibilities that are properly the responsibility of the board in general. Executive committees should have clearly defined outline of its charter, a clear method for delegating authority and an internal system of checks and balances.