Editing Board of directors (section)

===United States===

====Sarbanes–Oxley Act====

The [[Sarbanes–Oxley Act]] of 2002 has introduced new standards of accountability on boards of U.S. companies or companies listed on U.S. [[stock exchange]]s. Under the act, directors risk large fines and prison sentences in the case of accounting crimes. [[Internal control]] is now the direct responsibility of directors. The vast majority of companies covered by the act have hired internal auditors to ensure that the company adheres to required standards of internal control. The internal auditors are required by law to report directly to an audit board, consisting of directors more than half of whom are outside directors, one of whom is a "financial expert".

The law requires companies listed on the major stock exchanges (NYSE, NASDAQ) to have a majority of independent directors—directors who are not otherwise employed by the firm or in a business relationship with it.

====Size====
According to the Corporate Library's study, the average size of publicly traded company's board is 9.2 members, and most boards range from 3 to 31 members. According to Investopedia, some analysts think the ideal size is seven.<ref name=BoD>{{cite web|url=http://www.investopedia.com/articles/analyst/03/111903.asp#ixzz27Kekd83e |title=Evaluating The Board of Directors|publisher= investopedia.com|date= 29 February 2008}}</ref> State law may specify a minimum number of directors, maximum number of directors, and qualifications for directors (e.g. whether board members must be individuals or may be business entities).<ref name=BoD2>{{cite web |url=https://www.harborcompliance.com/information/corporate-governance-by-state.php |archive-url=https://wayback.archive-it.org/all/20180817190105/https://www.harborcompliance.com/information/corporate-governance-by-state |url-status=dead |archive-date=17 August 2018 |title=U.S. Corporate Governance by State |publisher=harborcompliance.com |date=22 April 2014 }}</ref><ref name=BoD3>{{cite web |url=https://www.harborcompliance.com/information/nonprofit-governance-by-state.php |title=U.S. Nonprofit Governance by State |publisher=harborcompliance.com |date=27 January 2014 |access-date=27 January 2014 |archive-url=https://web.archive.org/web/20140201204758/https://www.harborcompliance.com/information/nonprofit-governance-by-state.php |archive-date=1 February 2014 |url-status=dead }}</ref>

====Committees====
While a board may have several committees, two—the compensation committee and audit committee—are critical and must be made up of at least three [[independent director]]s and no inside directors. Other common committees in boards are nominating and governance.<ref name=BoD/><ref>[http://www.klgates.com/files/Publication/f44a6446-4d3a-4847-a157-319c05d9667b/Presentation/PublicationAttachment/3900b2fd-2183-44e8-82d7-41bd4366f0f6/CompensationCommitteeStructure.pdf Compensation Committee Structure, Function and Best Practices] Richard E. Wood</ref>

====Compensation====
Directors of [[Fortune 500]] companies received median pay of $234,000 in 2011. Directorship is a part-time job. A 2011 study by the [[National Association of Corporate Directors]] in the United States estimated that directors averaged 4.3 hours a week on board work.<ref name=comp>{{cite news | url=https://www.usatoday.com/money/companies/management/story/2011-10-25/director-compensation-rising/50918332/1 | work=USA Today | title=Company directors see pay skyrocket | date=26 October 2011 | access-date=24 August 2017 | archive-date=7 May 2016 | archive-url=https://web.archive.org/web/20160507141607/http://www.usatoday.com/money/companies/management/story/2011-10-25/director-compensation-rising/50918332/1 | url-status=dead }}</ref> Surveys have indicated that about 20% of [[nonprofit foundation]]s pay their board members,<ref name="Schambra">{{cite journal | last=Schambra | first=William A. | title=Board Compensation: To Pay or Not to Pay? | journal=Philanthropy Magazine | date=Winter 2008 | publisher=Philanthropy Roundtable |url=http://www.philanthropyroundtable.org/topic/philanthropic_freedom/compensating_foundation_directors1 | access-date=2 May 2017 | archive-url=https://web.archive.org/web/20170516095648/http://www.philanthropyroundtable.org/topic/philanthropic_freedom/compensating_foundation_directors1 | archive-date=16 May 2017 | url-status=dead }}</ref> and 2% of American [[nonprofit organization]]s do.{{sfn|BoardSource|2015|p=52}}<ref>Cf. {{citation |author=Internal Revenue Service |title=Governance and Related Topics - 501(c)(3) Organizations |date=4 February 2008 |location=Washington, DC |publisher=Author |url=https://www.irs.gov/pub/irs-tege/governance_practices.pdf |archive-url=https://ghostarchive.org/archive/20221009/https://www.irs.gov/pub/irs-tege/governance_practices.pdf |archive-date=2022-10-09 |url-status=live |quote=Charities should generally not compensate persons for service on the board of directors except to reimburse direct expenses of such service. ... Charities may pay reasonable compensation for services provided by officers and staff.|author-link=Internal Revenue Service }}</ref><!--
Discussion:
<ref name="Fritz 2010">{{cite web | last=Fritz | first=Joanne | title=Can Nonprofit Board Members Receive Compensation? | website=The Balance | date=1 January 2010 |url=https://www.thebalance.com/can-nonprofits-pay-board-members-or-appoint-paid-staff-2502271 | access-date=2 May 2017}}</ref><ref>{{cite web | title=Can board members be paid? | website=National Council of Nonprofits | date=14 January 2015 |url=https://www.councilofnonprofits.org/tools-resources/can-board-members-be-paid | access-date=2 May 2017}}</ref>
--> 80% of nonprofit organizations require board members to personally contribute to the organization.{{sfn|BoardSource|2015|p=31}}<ref>{{citation |author=[[BoardSource]] |title=Recommended governance practices |date=12 October 2016 |location=Washington, DC |url=https://boardsource.org/wp-content/uploads/2016/10/Recommended-Gov-Practices.pdf#page=4 |access-date=2 May 2017 |page=4 |archive-url=https://web.archive.org/web/20170302184430/https://boardsource.org/wp-content/uploads/2016/10/Recommended-Gov-Practices.pdf#page=4 |archive-date=2 March 2017 |url-status=dead }}</ref> As of 2007, this percentage had increased in recent years.{{clarify timeframe|date=December 2021}}<ref>{{citation |first=Grant |last=Thornton |title=National Board Governance Survey for Not-for-Profit Organizations 2007 |date=7 November 2007 |location=Chicago, IL |url=https://www.grantthornton.com/staticfiles/GTCom/files/Industries/NotForProfit/07_BG_Survey.pdf#page=9 |archive-url=https://web.archive.org/web/20081117033211/https://www.grantthornton.com/staticfiles/GTCom/files/Industries/NotForProfit/07_BG_Survey.pdf#page=9 |archive-date=17 November 2008 |url-status=dead |access-date=2 May 2017 |page=9|author-link=Grant Thornton }}</ref><ref>{{cite web |url=http://leadingwithintent.org/past-reports/ |url-status=dead |archive-url=https://web.archive.org/web/20160313062336/http://leadingwithintent.org/past-reports/ |title=Past Surveys |website=leadingwithintent.org |archive-date=13 March 2016 }}</ref><ref>{{citation |author=BoardSource |title=BoardSource nonprofit governance index 2010 |date=17 November 2010 |location=Washington, DC |url=http://www.performingartsconvention.org/file/BoardSource%20Nonprofit%20Governance%20Index%202010.pdf#page=12 |page=12 |access-date=2 May 2017 |archive-url=https://web.archive.org/web/20180817190108/http://www.performingartsconvention.org/file/BoardSource%20Nonprofit%20Governance%20Index%202010.pdf#page=12 |archive-date=17 August 2018 |url-status=dead }}</ref>