Bestyrelsen

Bestyrelsen is the governing or supervisory board in Danish organizations, typically elected by shareholders in companies or by members in associations and foundations. The term denotes the body responsible for overseeing the organization’s strategic direction and overall governance, rather than managing day-to-day operations.

Composition and leadership vary by entity but commonly include non-executive directors and a chairperson (formand). Board members are usually elected for defined terms by the governing body of the organization, such as the general meeting, and may include independent directors to ensure objectivity. In many businesses, the board appoints or approves the appointment of the chief executive officer (CEO) or executive director and defines the framework for management performance.

Responsibilities of the bestyrelse typically include setting strategy, approving budgets and business plans, monitoring financial reporting and performance, overseeing risk management and internal controls, ensuring legal and regulatory compliance, and safeguarding the organization’s integrity and assets. The board may also approve major transactions, appoint or dismiss senior executives, and establish remuneration policies. Many boards form committees, such as audit, remuneration, or risk committees, to handle specialized oversight tasks.

Relationship to management and governance: the bestyrelse provides oversight and strategic guidance, while the day-to-day management is handled by the executive leadership. The board has fiduciary duties to act in the organization’s best interests, avoid conflicts of interest, and comply with statutes and the articles of association.

Legal framework: In Denmark, the bestyrelse operates under the Danish Companies Act (selskabsloven) and relevant legislation, with additional guidance from governance codes applicable to listed companies or specific sectors. The exact rights, duties, and procedures are defined in the organization’s statutes and applicable law.