What role does the board of directors play in corporate governance?

The board of directors is fundamentally responsible for strategic oversight and governance within an organization. This role involves setting the overall direction and strategy of the company, ensuring that it aligns with stakeholder interests and complies with legal and regulatory requirements. The board is tasked with overseeing management's performance, making significant decisions that affect the company’s future, and safeguarding shareholders' interests.

By focusing on governance, the board establishes policies that guide the management in its day-to-day operations without directly managing these operations themselves. This separation of responsibilities is essential to maintain a clear distinction between strategic oversight (the responsibility of the board) and operational management (the responsibility of executives).

In contrast, the remaining options are not aligned with the true role of the board. Directly managing daily operations would blur the line between governance and management, which is not the board's function. The notion that the board is only involved during annual meetings is misleading, as their responsibilities extend beyond these meetings, requiring continuous engagement and oversight. Lastly, limiting the input of shareholders would undermine the principles of good governance, which emphasizes transparency, accountability, and the need for shareholder input. Thus, the role of the board is accurately captured in the assertion that they are responsible for strategic oversight and governance.