How To Direct And Manage A Company - A study by Artur Victoria

The proprietors of a company are its shareholders, but as there may be several thousand shareholders, many of them knowing little of business, they are obliged to delegate the conduct of the company's affairs to a board of directors.

The authority of the directors is a corporate authority, that is to say it can be exercised only through a resolution of the board. The office of director carries with it no personal authority to give instructions or make decisions on behalf of the company. Frequently, however, managers employed by the company are invited to become directors. It is easy to see why this happens. If the board is discussing production matters it is helpful to have the works manager present, and if it is discussing sales policy it will wish the sales manager to contribute. It is a short step from inviting these executives to particular meetings to inviting them to be regular members of the board. Indeed, since policy in different fields interlock (there is an obvious interlock among research, design, production, sales, and finance) there is an advantage in having the principal heads of department on the board. leia todo o artigo