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Executive Limitations Policies

These are policies that prohibit the management methods, practices, conduct, circumstances, and so forth that the policy governance board deems or sees as unacceptable means, while achieving the defined ends. Stated another way, the board uses policies in this category to optimise executive empowerment by setting limits, while withdrawing safely from most details of operations. While policies that are in this category are written in negative format, the intention is that the CEO would psychologically see the positive sides of those negatively worded limitations. Specifically, the CEO is given the authority to make any decisions and engage in any activities that do not violate policies within this category. These policies do not prescribe what the CEO should do, but rather what the CEO is constraint from doing, thus, within the set boundaries, the CEO can exercise judgment in dealing with day-to-day organisational matters. Some of the policies found in this category are:

   Emergency CEO succession
   Asset protection
   Financial Planning and budgeting
   Financial condition and activities
   Communication and support to the board
   Trading in organisation’s securities
   Investments
   Diversification
   Dealing with shareholders
   Treatment of staff
   Treatment of vendors/suppliers/contractors
   Treatment of consumers/customers
   Treatment of other stakeholders
   Compensation and benefits
   General Executive Constraint