Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail
Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail

Boardroom

What it is:

A boardroom is a place in which a board of directors meets.

How it works (Example):

A board of directors is a team of people elected by a corporation's shareholders to represent the shareholders' interests and ensure that the company's management acts on their behalf. The head of the board of directors is the chairman or chairperson of the board.

Directors attend board meetings, usually quarterly, in order to evaluate management performance, tend to major decisions (such as making acquisitions or selling the company), declare dividends, create stock-option policies (including approving grants to key managers) and establish executive compensation packages. These board meetings are held in the boardroom.

Why it Matters:

Often, boardrooms are little more than conference rooms with big, long tables (to seat all the board members). However, they are sometimes the most important place to be when a company is deciding its future, struggling for it survival or plotting revenge against competitors. Board meetings are often confidential in nature, which means that only certain people are permitted in the boardroom during meetings.