One of the most misunderstood relationships in governance is the relationship between the board, management, and the external auditors. Most executives assume auditors work with management because management: Coordinates the audit process Provides financial information Responds to audit requests Owns day-to-day financial operations Operationally, that is true. Governance-wise, it is not. External auditors work for the board—not management. And for those stepping into private

Understanding the Legal Responsibilities of Board Members Serving on a board of directors carries significant responsibility. Directors are not simply advisors they are legally responsible for overseeing the company in the best interests of its shareholders. For private company boards, these responsibilities center on three fundamental fiduciary duties. Understanding these duties is essential for both companies building boards and executives serving as independent directors.