The executive committee is a subcommittee of board of directors. It is the organ that governs the company, oversees the management, decides on strategy www.boardroomsupply.com/tips-to-organize-an-efficient-online-board-meeting/ and supervises its members. The members are elected by shareholders or shareholders. They meet regularly to examine the financial performance of the company, set policies and choose the top management. It is also the governing body responsible for ensuring the compliance with good governance practices.
Executive committees, in contrast to the full board are smaller committees which have close ties with their leaders. They can meet swiftly and with short notice to discuss major issues, such as urgent workplace issues, high-level strategic decisions, or organisational supervision. Typically, they’re responsible for ensuring board members understand their roles and responsibilities. They also provide effective training in governance practices. They could also be responsible for choosing a new CEO or conducting CEO performance reviews, and reporting to the board.
In the end, the executive committee functions as the steering wheel of the board, giving priority to issues that the board should be addressing. However, it is essential that the executive committee is completely transparent with the rest of board on its decisions and is in compliance with the board’s guidelines. To achieve this, it is suggested that the executive committee be a standing committee of the board with a fixed term of office and formal terms of reference. This makes it easier for the entire board to know whether an issue was dealt with by the executive committee, and when it is still requiring the attention of the entire board.