What is a board of directors?
AnswerA group elected to oversee an organization
Boards set direction and oversee management.
Business · Facts & stats
Directors facts & stats
7 fact-checked facts about boards of directors and corporate governance, each with the reason behind it. 5 more are in today's round and join this page after it closes.
The basics
What does 'CEO' stand for?
AnswerChief Executive Officer
The CEO runs day-to-day operations and reports to the board.
Going deeper
What is an independent director?
AnswerOne with no material ties to the company beyond board service
Independence helps boards oversee management objectively.
Which board committee typically oversees financial reporting and the auditors?
AnswerAudit committee
The audit committee works with outside auditors.
What is fiduciary duty?
AnswerA duty to act in the best interests of those you serve
Directors owe fiduciary duties to the company and its owners.
Expert level
Directors' two core fiduciary duties are usually called what?
AnswerDuty of care and duty of loyalty
Care means informed decisions; loyalty means no self-dealing.
Which 2002 U.S. law tightened rules on corporate financial reporting and audit committees?
AnswerSarbanes-Oxley Act
Sarbanes-Oxley followed major accounting scandals.
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