Reputation Doctor® LLC provides CEO and board advisory services to leading corporations. In this article, we define what a board of directors is, what a board does and share five steps to take when considering how to form a board of directors.Non-membership organizations have self-perpetuating boards of directors, meaning that the directors nominate and elect people to serve on the board. It may come as a surprise, but there are cases where individuals can be board members but not hold the title of director. An outside director is a board member who serves on a company's board, but is neither a stakeholder nor an employee. In public companies, the board of directors is also responsible to the shareholders, and can be voted out in a shareholder election. Members attended meetings regularly, had lots of personal money invested in the company, and weren't too old, young, or numerous. Remember, a nonprofit organization is not required to file corporate tax return (Form 1120) with the IRS. Strong leaders are the backbone of successful organizations. Not only did all but one of the Enron board members own impressive amounts of equity in the company, but some were still buying as the shares collapsed.