Board Characteristics
Board Composition – in terms of ratio of inside and outside directors, and the number of directors influence the effectiveness of the board. A board size of nine to fifteen is considered to be adequately tailored to the number of board standing committees.
Board Authority – is granted trough shareholder elections. SOX substantially expanded the authority of directors, particularly audit committee members, as being directly responsible for hiring, firing, compensating, and overseeing the work of the companies’ independent auditors.
Responsibilities – the primary responsibility of the board of directors that the companies assets are safeguarded and that managerial decisions and actions are made in a manner of maximizing shareholders wealth while protecting the interests of other shareholders.