The constitution of a non-executive board of directors is the opportunity to onboard diverse skills that are often missing in start-up and SMEs A well-constituted board of directors brings credibility to a company. Investors, financial institutions, suppliers, customers view this body as a mitigation of the risk Experienced board members who sit on SME and startup boards understand the specifics of small and fast moving companies. They are trained to see the signals of opportunities and risks and will help to make the right decisions at the right time
Board members are highly exposed in a small company! The resources are limited and time to make decisions as well. Sitting on a board of a startup or fast-moving SME is like running a Formula 1. Any decision will have a very direct impact on the company. It can save or damage the company. A startup or SME will naturally experiment several crisis in a very short time. Which means you need to perfectly manage and understand Swiss legal framework, over-indebtedness matters and board duties.
Professional and experienced board members can help founders to identify and avoid pitfalls and risks that could hurt their company or the founders themselves. Professional boards members master the intricacies of legal requirements and social obligations. A well functioning board helps to make sound business decisions by challenging the executives propositions and bringing the helicopter view. Independent board members can play a crucial role in balancing founders and investors relationships.
In Switzerland, the board of directors has to act in the best interest of the whole company and its stakeholders. Each member of the board has to stay loyal to the company no matter what! Another specificity of Switzerland: The board of directors manages the business of the company, unless responsibility for such management has been delegated. If the delegation is given, the board has the responsibility of the overall supervision of the persons entrusted with managing the company.
In Switzerland, the board position is a personal assignment. Each board member has a personal liability and there is no true nor complete protection. The board is mostly in trouble when there was a breach of general duty of care and damage to some companies stakeholders. In Switzerland, a board member who did not fulfil his or her duty can be sued as a person and may have to pay from his or her own pocket.