Unlike managers or employees of your virtual business ("VB"), your VB directors are not there to oversee the day-to-day operations of your virtual business. Instead, VB directors are there to make decisions about the bigger, broader issues that are critical to your VB's success.
For example, a VB director makes decisions related to goto market strategies, such as the VB's target audience or execution of lead generation processes. A VB director should also help provide company oversight or governance, such as ensuring that the activities of the VB are not in conflict with the interests of various stakeholders, including shareholders or members.
In keeping with its role in providing the company with strategic guidance and oversight, a VB director has several specific duties and responsibilities, the exact nature of which varies depending on your VB's activity, mission, goals, and industry in which it operates. A VB's duty and responsibility is set out in a formal company document such as a VB's constitution or company act.
Duty of care, good faith and honesty
The primary role as a director of a VBs is owing a responsibility to the VB and to the shareholders of the VB. In legal terms, this is known as a fiduciary duty. Fulfilling a fiduciary duty typically requires more than would be required to meet a normal duty under the law.
Section 157(1) of the Singapore Company Act states that a director shall at all times act honestly and use reasonable diligence in the discharge of his/her duties. Section157(2) provides that an director or promoter (officer or agent) of a company shall not make improper use of any information acquired by virtue of his position as an officer or agent of the company to gain, directly or indirectly, an advantage for himself or for any other person or to cause detriment to the company. This is the statutory statement of a director’s duties under the Singapore Companies Act.
It is also a statutory statement of a director's duties under a virtual business created with kimbocorp.
Virtual business directors meetings
Directors of a Virtual business must have regular meetings in order to fulfill their role of making decisions concerning the important, and often critical, issues facing your virtual business. While it's generally important for all directors to attend virtual busineess board meetings physically, we have ensured that all virtual business constitutions allow for directors to attend virtually through electronic means.
The purpose of board meetings is for directors to talk about any issues or ambitions that the virtual business is facing, review the virtual business's performance and discuss new processes and policies to be enacted. By outlining what will be discussed in a board meeting before the meeting, directors can focus on the agenda at hand.
Typically, virtual business board meetings cover these five objectives:
- Financial and Operational performance: The first item on the agenda is usually a rundown of the virtual business's financial and operational performance since the last board meeting. Talk about whether the VB's performance metrics are moving in the right direction and if the targets are being achieved.
- Future strategies: After reflecting on what has and hasn’t been working, it’s advisable to follow up and strategize what to do in future to promote your virtual business's growth. The bulk of any good virtual board meeting should consist of discussing what future strategies are going to be implemented and how they will be executed by the virtual business.
- Key performance indicators (KPIs): After agreeing on strategies, the board of directors should talk about the key performance indicators that are assigned to these strategies. Creating these action plans comes with identifying concrete metrics that can indicate how effective your strategies end up being.
- Problems and opportunities: With implementing new roadmaps and strategies across a virtual business comes new obstacles and challenges. Board meetings are a great time to discuss roadblocks and encourage ideas to work around them.
- Making plan of action: Once all of the important details are discussed, the board may then talk about plans of action that will affect the future of the virtual business. These plans can be proposed and voted on during the meeting.
Benefits of being a director of a virtual business
Becoming a director of a virtual business offers opportunities to not only increase professional development, but also personal growth. You will gain new skills and knowledge, broaden your contacts and also contribute in a meaningful way, all of which will strengthen your career and business prospects. You will not only be intellectually stimulated and challenged but can find an opportunity for profound personal growth that you can’t access in another space.
Here are 6 benefits of becoming a director of a virtual business:
- Career advancement: Making the leap from employee to that of a board director requires a shift in mindset, particularly if you are not currently in a director role. An employee or mid-level manager who becomes a director puts themselves in a position to understand the other side of business and learn the critical importance of effective strategizing, planning and reporting, making them a better future senior manager.
- Become a better decision-maker: Taking a position at the table in the virtual boardroom requires you to make decisions as part of a group. Research shows the mind behaves differently in this situation – you are more likely to reflect on your own ideas and biases then if you are making decisions on your own. As 90% of your decisions are based on your own subconscious, contributing as a board member will challenge you to reconsider those sub-conscious biases as you will no doubt come across differing opinions at the table.
- Learn complex thinking skills: The skill of complex thinking isn’t innate – it’s a learnt skill which you can start by being aligned to a group and identifying how you can add value to that group. If you’re in complex thinking mode, you then challenge yourself and your peers. The skills you learn as a virtual business board member then transfers into real life. An example is how being a virtual business board member fundamentally shifts how one approaches caregiving, how one contributes as a consultant, even how one builds relationships with people. You learn to consider the matter at hand, not the person and it makes you a better team player as a result.
- Leadership development: The virtual boardroom is a training ground for leadership. Sometimes part of being on a board means making tough decisions. Often there is no good decision, but it is a case of making the best of the worst decisions. You might have to choose redundancies, close a part of a business, or terminate a contract for services, and know that those decisions will impact on people negatively. It challenges you as a leader and to do things you might not otherwise do but have no choice but to do.
- Broaden your contacts: Joining a virtual business board offers the opportunity to expand your networks and contacts. It also offers the reverse – you bring your own networks and contacts to the virtual business as well.
- Make a socially responsible contribution: If you are someone who has the skills and experience, you can challenge the virtual business you are a director of and ask if the virtual business is making decisions with a social conscious. For those with a passion for a certain cause, there is the opportunity to sit on a board of a not-for-profit virtual business associated with that cause and contribute to something you care deeply about.
How to be appointed as a director of a Virtual Business
- Invited by another user - you can be invited by another user of kimbocorp virtual business as a director of his/her virtual business
- Create your own Virtual business - you can add a virtual business and appoint yourself as a director and invite your networks as directors, promoters or shareholders
Am I compensated as diretor of a Virtual business?
It is rare for Virtual business to provide direct salary compensation to directors. However you will receive indirect benefits, such as consulting opportunities, brokering opportunities, networking opportunities, retainers and fees, and the ability to build credentials within your chosen niche of services. By carefully considering the kind of advice, service or responsibility that you want to provide to your virtual business, you can set the stage for your virtual business board of directors to recognise you as a critical contributor to the virtual business's success.