Directors & Boards articles from March 1996

Directors & Boards archives from March 1996

The value-added director. (corporate director)
March 22, 1996... Having the right directors, who bring the right chemistry to the board, is more important than ever to help a company achieve its potential. Boards of directors can be compared with basketball or baseball teams. The team might have a...

Putting directors to work adding value. (Acordia Inc.)
March 22, 1996... Profile of one company's governance structure: each of its highly autonomous operating companies has its own outsider-dominated board. The title of an entire chapter in "Management," the landmark book written by management consultant Peter...

Background checking on board candidates. (board of directors)
March 22, 1996... There is no need to rely solely on a candidate's own information or a cursory background check by a search firm. Here are 10 discreet ways to help make an informed decision. The board's nominating committee has recommended a new director,...

Boards and the new leader dilemma.
March 22, 1996... Here are 15 suggestions for how boards can work closely with the company's new leader to help avoid career-derailing pitfalls. Edward Johnston, the new chief executive in simulated succession case study (see accompanying sidebar), will soon be...

A director's role in strategy. (corporate director)
March 22, 1996... There is no clear consensus on how a board should involve itself in strategy formulation. Here is a framework for fulfilling that responsibility. It has never been easy being an excellent director, and it has gotten even tougher. Director's...

Ready for growth, but short of talent? (corporate governance)
March 22, 1996... If your company is in a growth mode again, here are some hiring, development, and succession guidelines for rebuilding your 'bench strength.' We notice a few companies in certain industries continuing to scale down their work forces, but it...

A spirited debate over director pay. (corporate directors)(includes related article)(response to Hoffer Kaback, Directors & Boards, Winter 1996)
March 22, 1996... The proposition that directors should not be forced to be paid in stock has sparked a round of rejoinders on the pay/performance nexus. In the Winter 1996 edition of DIRECTORS & BOARDS, we published an article entitled, "The Case for Cash for...

The positive effects of stock ownership. (response to Hoffer Kaback, Directors & Boards, Winter 1996)
March 22, 1996... Mr. Kaback argues with some passion that paying directors wholly or substantially in stock and/or requiring directors to own a significant amount of stock will impede rather than further corporate governance. Unfortunately, he presents no...

The director as employee of management. (corporate director)(response to Hoffer Kaback, Directors & Boards, Winter 1996)
March 22, 1996... Mr. Kaback's thesis that paying directors in stock may impede improved corporate governance, and, therefore, cash-based compensation is preferable, is fatally flawed in two major respects. First of all, it ignores the primary reason for the...

Excellent tools for compensation and alignment. (corporate director compensation)(response to Hoffer Kaback, Directors & Boards, Winter 1996)
March 22, 1996... While Hoffer Kaback and I would appear to be on different sides of the fence on the board compensation issue, interestingly, I find myself agreeing with some of his conclusions, but for somewhat different reasons. As a member of the NACD...

Who really is worthy of alignment? (corporate director compensation)(response to Hoffer Kaback, Directors & Boards, Winter 1996)
March 22, 1996... Hoffer Kaback has written a thoughtful and well-reasoned article, and I agree with many of his points. That may seem strange since I also served on the NACD Commission. But the fact is that the Commission deliberations were far from unanimous. In...

Director motivation is not the real issue. (corporate directors)(response to Hoffer Kaback, Directors & Boards, Winter 1996)
March 22, 1996... Mr. Kaback complains that the NACD report on director compensation, while conceding that directors are professionals, treats them differently from physicians, lawyers, engineers, architects, and accountants. Both Mr. Kaback and the NACD report...

A simplistic solution to a complex problem. (stock ownership for corporate directors)(response to Hoffer Kaback, Directors & Boards, Winter 1996)
March 22, 1996... I commend Hoffer Kaback for exposing the notion of mandatory stock ownership for directors for what is it - a chimera whose ostensible merits evaporate on closer examination. Compensating directors in cash does not cause or contribute to lax...

A reply from the author. (response to articles by Abraham Zalesnik, Robert Stobaugh, Charles M. Elson, James E. Marley, Barbara Hackman Franklin, Richard H. Koppes, Leslie Levy and Robert Salwen in this issue; pp. 30, 33, 34, 36, 37, 38, 41)
March 22, 1996... Proponents of Alignment emphasize the character of compensation. I emphasize the character of the director. My original article did not so much affirmatively urge cash compensation as demonstrate that the current obsession with Alignment is...

Leadership in a leveraged situation. (leverage businesses)(Spencer Stuart Governance Letter)(Panel Discussion)
March 22, 1996... Spencer Stuart works closely with a number of principal investment groups in helping them recruit CEOs and senior management for their portfolio companies. In these situations, the new leader usually operates against a backdrop of high leverage,...