The executive committee is a subcommittee that sits under the board of directors. It is an organisation’s governing body, which oversees management, sets strategy and supervises its members. The members are chosen by members or shareholders and meet regularly to examine the financial performance of the company and set the policies and choose the top management. It is also the governing body that makes sure there is adherence to good governance procedures.
Contrary to the board of directors executive committees are generally smaller groups that have close ties through the leadership. They are able to meet quickly and at very short notice to deal with major issues like urgent workplace matters, high-level strategic decision making or organisational oversight. Typically, they’re also accountable to ensure that board members know their responsibilities and roles. They also provide effective training in governance. They could be accountable for choosing a new CEO or conducting reviews of CEO performance and reporting to the board.
In the end, the executive board serves as the board’s steering wheel, giving priority to issues that the board should consider. However, it is essential that the executive committee is fully transparent with the rest of board on its decisions and is in compliance with the board’s guidelines. It is suggested that to accomplish this the executive committee be a permanent member of the board, with a fixed duration and formal timeframes. This will allow the board to easily see what issues were handled by the executive committee and which require the attention of the entire board.
