Editing Board of directors (section)

===Two-tier system===
In some European and Asian countries, there are two separate boards, an executive board (or management board) for day-to-day business and a [[supervisory board]] (elected by the shareholders and employees) for supervising the executive board. In these countries, the chairman of the supervisory board is equivalent to the chairman of a single-tier board, while the chairman of the management board is reckoned as the company's CEO or [[managing director]]. These two roles are always held by different people. This ensures a distinction between [[management]] by the executive board and [[corporate governance|governance]] by the supervisory board and allows for clear lines of authority. The aim is to prevent a [[conflict of interest]] and too much power being concentrated in the hands of one person. There is a strong parallel here with the structure of government, which tends to separate the political [[Cabinet (government)|cabinet]] from the management [[civil service]].

In the United States, the board of directors (elected by the shareholders) is often equivalent to the supervisory board, while the executive board may often be known as the executive committee (operating committee or executive council), composed of the CEO and their direct reports (other C-level officers, division/subsidiary heads).

Board structures and procedures vary both within and among [[OECD]] countries. Some countries have two-tier boards that separate the supervisory function and the management function into different bodies. Such systems typically have a "supervisory board" composed of nonexecutive board members and a "management board" composed entirely of executives. Other countries have "unitary" boards, which bring together executive and non-executive board members. In some countries there is also an additional statutory body for audit purposes. The OECD Principles are intended to be sufficiently general to apply to whatever board structure is charged with the functions of governing the enterprise and monitoring management.<ref>{{cite web |url=https://www.oecd.org/daf/ca/corporategovernanceprinciples/40823806.pdf |title=Using the OECD Principles for Corporate Governance: A Boardroom Perspective |publisher=Organisation for Economic Co-operation and Development (OECD) |access-date=8 October 2021 |url-status=live |archive-url=https://web.archive.org/web/20131018081441/http://www.oecd.org/daf/ca/corporategovernanceprinciples/40823806.pdf |archive-date=18 October 2013 }}</ref>