When a board of directors articulates its expectations of directors by establishing a Directors’ Code of Conduct, three positive outcomes follow.
- First, directors are not subsequently surprised by the requirements of their position because they have been advised in advance of what is expected of them.
- Second, directors can be held accountable for their volunteer performance.
- Third, there is a greater probability that their performance will rise to meet the expectations that have been established. Similarly, when boards of directors communicate their expectations of the CEO by showing a CEO Code of Conduct, the same benefits result.
📓 Sample Codes of Conduct can be found in the course materials