Business Ethics & Corporate Governance

SUMMARY: The composition and the size of the board play a crucial role in the effective functioning of the board. Directors can be classified into different types depending on their relationship with the company on whose board they serve.

In this chapter we defined different types of directors like the executive director, non-executive directors, nominee directors, representative directors, alternate directors shadow directors and associate directors.

Depending on the mix of executive and non-executive directors present on a board they can be classified into four types: All executive board, majority executive board, majority outside board and two-tier supervisory board. This chapter also discussed some issues that are to be considered while designing a board. Further the chapter analyses various functioning styles of boards.