A Primer on Corporate Governance, Second Edition, 2nd Edition

Chapter 3

The Board: Role and Composition

The Legal Framework

From a legal perspective, the board of a public corporation is charged with setting a corporation’s policy and direction, electing and appointing officers and agents to act on behalf of the corporation, and acting on other major matters affecting the corporation. In this context, individual directors’ duties and responsibilities are described in the American Bar Association’s Corporate Director’s Guidebook, Fourth Edition (2004) with language, such as the following:

•In good faith. Acting honestly and dealing fairly. In contrast, a lack of good faith would be evidenced by acting, or causing the corporation to act, for the director’s personal benefit or for some purpose other than ...