Some reflections after reading What's a Director to Do? By Joseph Fuller and Michael C. Jensen.
The emergence of the CEO as autocrat has reduced the position of boards of directors to "parsley on fish." If a different system is desired, boards will have to change in virtually all relevant respects: in who is nominated; in how their service is evaluated; in their responsibilities; in whether they are effectively liable for negligence or for beach of trust. We will know if this desired state exists when we no longer have directors and officers liability insurance and directors take full responsibility for their fiduciary relationships.April 26, 2011 in accountability , fiduciary duty , board collegiality , directors , independent directors | 0 comments |