Involvement of board of directors in strategy development has been a debatable issue that invites the attention of both academicians and practitioners; as there are no fixed perceptions in this regard. Corporate governance structure prior to early 1980s was such that the role of directors in strategy was not necessary and was carried out perfunctorily; and boards rarely went beyond the call of statute. They largely ignored the potential performance roles like in formulating company strategy. However, the situation changed profoundly since the beginning of 1980s, in wake of growing mergers and acquisitions, emergence of new class of owners, global competition, increased complexities and risks of business, corporate failures, emergence of new breed of CEOs and new regulatory frameworks. These developments brought attitudinal change, but real action took place in select organizations only. Current global turmoil also augurs well for legislative and shareholder actions to further emphasise strategy formulation by the board of directors.
Board of directors, strategy, strategy formulation, regulation, conformance & performance
