This document discusses the changing role of corporate boards. It notes that failures in board governance contributed to the 2008 global financial crisis. To improve oversight, boards must refocus on shareholder value and trust. There has long been tension between CEOs and shareholders over control of boards and their agendas. Recent reforms aim to make boards more independent and accountable in order to better represent shareholders and prevent future crises.
Strategic leadership of ethical behavior in businessMonamoharram
The document discusses the strategic leadership of ethical behavior in business. It argues that executives must accept responsibility for leading ethics initiatives within their organizations. Failing to do so can result in significant costs to the company from lack of ethical conduct. These costs go beyond direct fines and penalties to include long-term damage from loss of reputation and trust with stakeholders. The article examines the case of Arthur Andersen to illustrate how even large companies can collapse due to erosion of ethics. It emphasizes that executives must create a sense of urgency around ethics, influence employees to make ethical decisions as a norm, and anchor ethical culture within the organization.
How to structure the leadership of large corporations – and specifically whether to split or combine the roles of Chairman and CEO – remains an active and often controversial question.
In order to cast new and up-to-date light on the question of whether and when to change the Chairman-CEO structure, we studied the experience of the Fortune 100 over the last decade and more. In this report we share our observations, conclusions, and recommendations regarding leadership structure, including the increasingly important role of independent Lead Director whenever the Chairman and CEO roles are combined.
Leadership, Intangibles & Talent Q3 2009 Four GroupsFour Groups
Welcome to 2009’s third quarterly review, as with previous issues, engagement continues to be at the forefront of people’s thoughts. Behind the engagement debate however there seems to be a growing call for a wider reappraisal of the fundamental way corporations are organised and for me personally, this is the most interesting aspect of this quarter’s articles. Other themes include;
• Shifting the Organisational Pyramid
• The McLeod Review on Employee Engagement
• The Leader/Manager Debate
• Line Managers who Lead
• The Intrinsic Motivation of Autonomy, Mastery and Purpose
• The Irrationality of Human Behaviour
• Tomorrow’s HR Professionals - A Multi-Disciplinary Background
Articles are included from the likes of Harvard Business School, Henry Mintzberg, HR Magazine, McKinsey, the McLeod Review, the Partnership Institute, Personnel Today, Strategy + Business and TED.
This document discusses the importance of ethics for corporate boards. It argues that ethics are essential and not optional for boards for several reasons. Failing to consider ethics can lead to bad decisions, reduce shareholder value, and destroy trust. While some argue focusing on ethics may not be affordable, the document counters that ethics should remain a priority given legal requirements and that upholding ethics is good for business in the long run by maintaining trust and reputation. The document emphasizes that without strong ethical boundaries, even the best companies can make poor decisions.
The document discusses succession planning for the general counsel position. It recommends that companies:
1) Determine if there are qualified internal candidates and prepare them for the role, such as by giving them experience interacting with the board and contributing to growth plans.
2) Develop criteria for the general counsel position, identify internal and/or external candidates, select a successor, and groom them to take over.
3) Begin succession planning when the current general counsel is within two years of retirement, but it's never too soon to start by regularly assessing needs and criteria.
This document discusses the impacts of the economic recession on employee compensation. It notes that according to new research, salary freezes and cuts are becoming more common. Projected salary increases have dropped significantly in just a few months. Over a third of companies plan to freeze salaries and over a quarter plan headcount reductions. The recession is affecting pay, benefits, and job prospects at all levels. Organizations must focus on non-financial rewards like training and career development to maintain engagement during this challenging time. A strategic, talent-focused approach to compensation is needed to succeed in the current environment.
The document summarizes key findings from the 15th Annual Global CEO Survey conducted by PwC. It discusses declining confidence in the global economy among CEOs. While confidence in their own companies' growth prospects is higher, no CEOs are "very confident" about 12-month revenue growth. CEOs are focusing on adapting their operations to local markets, addressing risks from greater integration, and making talent a strategic priority to overcome execution challenges and position for longer-term growth.
This document discusses executive compensation and lessons learned from past practices. It provides background on compensation of chief executives, particularly in the United States. Key issues discussed include the many parties involved in executive compensation decisions, long-term rewards not tied to performance, and public outrage over large severance packages. The Dodd-Frank Act aimed to increase shareholder input and tie compensation more closely to performance. While reforms addressed some issues, questions still remain around justifying pay gaps and potential unintended consequences of performance-based compensation.
Strategic leadership of ethical behavior in businessMonamoharram
The document discusses the strategic leadership of ethical behavior in business. It argues that executives must accept responsibility for leading ethics initiatives within their organizations. Failing to do so can result in significant costs to the company from lack of ethical conduct. These costs go beyond direct fines and penalties to include long-term damage from loss of reputation and trust with stakeholders. The article examines the case of Arthur Andersen to illustrate how even large companies can collapse due to erosion of ethics. It emphasizes that executives must create a sense of urgency around ethics, influence employees to make ethical decisions as a norm, and anchor ethical culture within the organization.
How to structure the leadership of large corporations – and specifically whether to split or combine the roles of Chairman and CEO – remains an active and often controversial question.
In order to cast new and up-to-date light on the question of whether and when to change the Chairman-CEO structure, we studied the experience of the Fortune 100 over the last decade and more. In this report we share our observations, conclusions, and recommendations regarding leadership structure, including the increasingly important role of independent Lead Director whenever the Chairman and CEO roles are combined.
Leadership, Intangibles & Talent Q3 2009 Four GroupsFour Groups
Welcome to 2009’s third quarterly review, as with previous issues, engagement continues to be at the forefront of people’s thoughts. Behind the engagement debate however there seems to be a growing call for a wider reappraisal of the fundamental way corporations are organised and for me personally, this is the most interesting aspect of this quarter’s articles. Other themes include;
• Shifting the Organisational Pyramid
• The McLeod Review on Employee Engagement
• The Leader/Manager Debate
• Line Managers who Lead
• The Intrinsic Motivation of Autonomy, Mastery and Purpose
• The Irrationality of Human Behaviour
• Tomorrow’s HR Professionals - A Multi-Disciplinary Background
Articles are included from the likes of Harvard Business School, Henry Mintzberg, HR Magazine, McKinsey, the McLeod Review, the Partnership Institute, Personnel Today, Strategy + Business and TED.
This document discusses the importance of ethics for corporate boards. It argues that ethics are essential and not optional for boards for several reasons. Failing to consider ethics can lead to bad decisions, reduce shareholder value, and destroy trust. While some argue focusing on ethics may not be affordable, the document counters that ethics should remain a priority given legal requirements and that upholding ethics is good for business in the long run by maintaining trust and reputation. The document emphasizes that without strong ethical boundaries, even the best companies can make poor decisions.
The document discusses succession planning for the general counsel position. It recommends that companies:
1) Determine if there are qualified internal candidates and prepare them for the role, such as by giving them experience interacting with the board and contributing to growth plans.
2) Develop criteria for the general counsel position, identify internal and/or external candidates, select a successor, and groom them to take over.
3) Begin succession planning when the current general counsel is within two years of retirement, but it's never too soon to start by regularly assessing needs and criteria.
This document discusses the impacts of the economic recession on employee compensation. It notes that according to new research, salary freezes and cuts are becoming more common. Projected salary increases have dropped significantly in just a few months. Over a third of companies plan to freeze salaries and over a quarter plan headcount reductions. The recession is affecting pay, benefits, and job prospects at all levels. Organizations must focus on non-financial rewards like training and career development to maintain engagement during this challenging time. A strategic, talent-focused approach to compensation is needed to succeed in the current environment.
The document summarizes key findings from the 15th Annual Global CEO Survey conducted by PwC. It discusses declining confidence in the global economy among CEOs. While confidence in their own companies' growth prospects is higher, no CEOs are "very confident" about 12-month revenue growth. CEOs are focusing on adapting their operations to local markets, addressing risks from greater integration, and making talent a strategic priority to overcome execution challenges and position for longer-term growth.
This document discusses executive compensation and lessons learned from past practices. It provides background on compensation of chief executives, particularly in the United States. Key issues discussed include the many parties involved in executive compensation decisions, long-term rewards not tied to performance, and public outrage over large severance packages. The Dodd-Frank Act aimed to increase shareholder input and tie compensation more closely to performance. While reforms addressed some issues, questions still remain around justifying pay gaps and potential unintended consequences of performance-based compensation.
This document contains an article summarizing the onerous duties and significant liabilities faced by directors of companies in Malaysia. It discusses how directors are generally defined and why their role has received increased scrutiny. Directors can be held personally liable for breaches of their fiduciary duty to the company or failures to comply with statutory requirements, and face penalties like sanctions or criminal charges. Overall the article aims to serve as a guide on the substantial legal exposure directors take on through their important role of overseeing a company.
The 15th Annual Global CEO Survey found that CEO confidence has declined as the global economic outlook remains uncertain. Half of CEOs expect the global economy to decline in 2012. However, CEOs remain more confident in their own companies' growth prospects over the next year. They are focusing on adapting their strategies and operations to important local markets, managing talent, and addressing risks in a more integrated global environment. Key priorities for CEOs include reconfiguring operations, developing talent strategies, and managing newly amplified risks from greater economic integration.
- Two shipwrecked parties on opposite sides of Auckland Islands in 1864 had very different outcomes due to their leadership and teamwork. Captain Musgrave's party of 5 worked together over 20 months to survive by building shelter, finding food, and eventually escaping on a boat they constructed. Meanwhile, Captain Dalgarno's party of 19 fell into despair, conflict, and eventually cannibalism with only 3 surviving.
- Building high performing teams requires understanding key components like context, mission, talent, and norms. Teams must align on assumptions, set clear and measurable goals, ensure the right people and skills are present, and establish effective rules of operation.
The chief executive of a New Zealand tech company recommends several factors for successfully expanding a business into the US market during difficult economic times:
1) The chief executive needs to relocate to the US to demonstrate commitment and better understand the market firsthand.
2) Hiring top local talent is critical but difficult, requiring psychometric testing and deep reference checks to find truly excellent employees.
3) Americans appreciate the less formal work culture of New Zealand companies. However, pay and equity incentives must be competitive to attract top talent.
4) Cash reserves are extremely important in a recession as sales cycles lengthen and some customers may default on payments. Companies must plan accordingly. Guidance from experienced organizations can help navigate
This document summarizes and discusses mergers and acquisitions. It begins by defining mergers and acquisitions as strategic management tools used to improve organizational performance through friendly or hostile takeovers. It then discusses in detail the AOL-Time Warner merger as an example of a friendly takeover. Key points included the contributions and strategy of the merger, as well as its aftermath which was ultimately considered unsuccessful. The document also summarizes hostile takeovers and various defense strategies used by target companies.
What does a global finance team think about the future of the CPA Profession and the organizations that serves them?
Tom Hood, CPA, CITP, CGMA shares his insights about the trends and issues facing the CPA Profession on a global, national, and local level. He draws on experience designing and facilitating future forums for the CPA Horizons 2025 Project. Talks about legislation and advocacy for professional standards along with the latest trends and issues facing all of us. He closes with tips on maximizing your career trajectory via The Bounce!
The document discusses the "Six Rs of Association Thrivability" that are critical for associations to thrive in the current environment. The six Rs are: 1) Realism for action to honestly confront challenges, 2) Responsibility for stewardship by taking intelligent risks, 3) Readiness for learning through strategy as a learning process, 4) Resources for investment by treating profitability as a priority, 5) Relationships for collaboration by building networks beyond members, and 6) Resilience for growth by increasing resilience at all levels to enable smart decisions during disruption. Following these imperatives will help associations build 21st century organizations capable of flourishing in the current volatile environment.
The document discusses the need for a "Third Wave" of leadership development to better prepare leaders for today's challenges. It outlines three pressures leaders face: disruption of industries, erosion of trust in leadership, and a new power equilibrium between leaders and followers. The summary discusses how past models of leadership development focused on knowledge in the "First Wave" and skills/styles in the "Second Wave" but are now outdated. The "Third Wave" proposes focusing on developing leaders' agility, authenticity and sense of purpose through more immersive techniques to prepare them for the new challenges of disruption, lack of trust and shared power.
Today's organizations are deeply embedded in complex ecosystems. Understanding your company's space in its ecosystem can help you anticipate market challenges and help your company thrive during change. This article, originally published by CIO.com, explains what an ecosystem is and why curing ecosystem blindness is essential for leaders today.
More: http://partneringresources.com/change-leadership-resources/
Public Engagement: Survive and Thrive in a Bigger Society Vol. 3Edelman Digital
The third volume of Edelman’s annual publication, Public Engagement: Survive and Thrive in a Bigger Society, is a collection of thought pieces written by the UK team in which we continue to explore the shifting media, thought and working landscapes that we inhabit, as well as the increasingly complex relationship between businesses, brands, government, the media and society.
1) CEOs now see complexity, rather than change, as their primary challenge due to a highly volatile, uncertain, and complex global environment.
2) While 79% of CEOs expect complexity to increase further, some organizations have managed to turn greater complexity into financial advantage.
3) CEOs identified creativity as the most important leadership quality for navigating increasing complexity.
This document summarizes interviews with five industry leaders on pressing issues facing the hedge fund industry. The leaders discussed how due diligence processes have changed in light of recent events, focusing more on counterparty risk. They also addressed how changes in investor attitudes have affected their businesses and how increased transparency is important. Regarding regulation, opinions varied from mandatory registration to focusing on solid due diligence practices. Major changes foreseen in the next five years include increased concentration in the industry and some increased regulation.
This document provides a summary of the Rocket Model for building high-performing teams. The Rocket Model is a framework that consists of 9 components: Context, Mission, Talent, Norms, Buy-In, Power, Morale, Results, and Concluding Comments. It describes each component and what teams need to do to improve in each area. The model can be used to assess what is going well or poorly on a team and identify actions to enhance performance. Following the components in order is important as each drives the next. The model has helped hundreds of teams work more effectively together.
The document discusses how most CEOs feel unprepared for the rapidly escalating complexity in today's economic environment, which they see as substantially more volatile, uncertain, and complex, however a group of "Standout" organizations have consistently performed well by mitigating complexity. Global shifts like increased interconnectivity and the rise of new technologies are compounding complexity. While CEOs expect disruption to continue, they must find new ways to lead their organizations to succeed in this drastically changed world.
1) El documento describe los servicios de consultoría de una empresa llamada Asertys para ayudar a otras empresas a lograr la efectividad y la transformación organizacional.
2) Asertys ofrece cinco servicios principales: estrategia y alineamiento organizacional, enfoque en el cliente, organización efectiva, desarrollo del potencial humano, y gestión de la cultura y el cambio.
3) Cada servicio incluye una descripción del problema que intenta resolver y un enfoque integrado para abordarlo a través de la definic
Ederives is a company that provides information design, web development, and print media services. It has a team of graphic designers, web designers and developers. The company aims to build its own brand equity by providing high quality, technologically advanced work to meet client needs. Ederives offers services like web design, development, internet marketing, e-commerce development, print media like brochures and posters, and motion graphics. It has an offshore team, competitive prices, and focuses on customer satisfaction, diligence, reliability, and timely delivery.
Meet In The Middle’S Rally To Spread TheMiMCalallen
Meet in the Middle hosted a pep rally to spread awareness about ending the use of a hurtful word. The rally featured student and guest speakers as well as a dance performance to support acceptance, humanity, passion, and unity. The local news station filmed the event and interviewed club members about their campaign to erase the hurtful word.
Meet In The Middle Halloween CelebrationMiMCalallen
The Meet in the Middle club held a Halloween celebration where scarecrows brought pumpkins from a patch and everyone watched a presentation together. They had a party to celebrate both Halloween and a Special Olympics bowling competition, where everyone brought and shared snacks. A boy wore a Special Olympics track suit and looked sharp, and everyone had a good time at the event hosted by the Meet in the Middle club.
This document contains an article summarizing the onerous duties and significant liabilities faced by directors of companies in Malaysia. It discusses how directors are generally defined and why their role has received increased scrutiny. Directors can be held personally liable for breaches of their fiduciary duty to the company or failures to comply with statutory requirements, and face penalties like sanctions or criminal charges. Overall the article aims to serve as a guide on the substantial legal exposure directors take on through their important role of overseeing a company.
The 15th Annual Global CEO Survey found that CEO confidence has declined as the global economic outlook remains uncertain. Half of CEOs expect the global economy to decline in 2012. However, CEOs remain more confident in their own companies' growth prospects over the next year. They are focusing on adapting their strategies and operations to important local markets, managing talent, and addressing risks in a more integrated global environment. Key priorities for CEOs include reconfiguring operations, developing talent strategies, and managing newly amplified risks from greater economic integration.
- Two shipwrecked parties on opposite sides of Auckland Islands in 1864 had very different outcomes due to their leadership and teamwork. Captain Musgrave's party of 5 worked together over 20 months to survive by building shelter, finding food, and eventually escaping on a boat they constructed. Meanwhile, Captain Dalgarno's party of 19 fell into despair, conflict, and eventually cannibalism with only 3 surviving.
- Building high performing teams requires understanding key components like context, mission, talent, and norms. Teams must align on assumptions, set clear and measurable goals, ensure the right people and skills are present, and establish effective rules of operation.
The chief executive of a New Zealand tech company recommends several factors for successfully expanding a business into the US market during difficult economic times:
1) The chief executive needs to relocate to the US to demonstrate commitment and better understand the market firsthand.
2) Hiring top local talent is critical but difficult, requiring psychometric testing and deep reference checks to find truly excellent employees.
3) Americans appreciate the less formal work culture of New Zealand companies. However, pay and equity incentives must be competitive to attract top talent.
4) Cash reserves are extremely important in a recession as sales cycles lengthen and some customers may default on payments. Companies must plan accordingly. Guidance from experienced organizations can help navigate
This document summarizes and discusses mergers and acquisitions. It begins by defining mergers and acquisitions as strategic management tools used to improve organizational performance through friendly or hostile takeovers. It then discusses in detail the AOL-Time Warner merger as an example of a friendly takeover. Key points included the contributions and strategy of the merger, as well as its aftermath which was ultimately considered unsuccessful. The document also summarizes hostile takeovers and various defense strategies used by target companies.
What does a global finance team think about the future of the CPA Profession and the organizations that serves them?
Tom Hood, CPA, CITP, CGMA shares his insights about the trends and issues facing the CPA Profession on a global, national, and local level. He draws on experience designing and facilitating future forums for the CPA Horizons 2025 Project. Talks about legislation and advocacy for professional standards along with the latest trends and issues facing all of us. He closes with tips on maximizing your career trajectory via The Bounce!
The document discusses the "Six Rs of Association Thrivability" that are critical for associations to thrive in the current environment. The six Rs are: 1) Realism for action to honestly confront challenges, 2) Responsibility for stewardship by taking intelligent risks, 3) Readiness for learning through strategy as a learning process, 4) Resources for investment by treating profitability as a priority, 5) Relationships for collaboration by building networks beyond members, and 6) Resilience for growth by increasing resilience at all levels to enable smart decisions during disruption. Following these imperatives will help associations build 21st century organizations capable of flourishing in the current volatile environment.
The document discusses the need for a "Third Wave" of leadership development to better prepare leaders for today's challenges. It outlines three pressures leaders face: disruption of industries, erosion of trust in leadership, and a new power equilibrium between leaders and followers. The summary discusses how past models of leadership development focused on knowledge in the "First Wave" and skills/styles in the "Second Wave" but are now outdated. The "Third Wave" proposes focusing on developing leaders' agility, authenticity and sense of purpose through more immersive techniques to prepare them for the new challenges of disruption, lack of trust and shared power.
Today's organizations are deeply embedded in complex ecosystems. Understanding your company's space in its ecosystem can help you anticipate market challenges and help your company thrive during change. This article, originally published by CIO.com, explains what an ecosystem is and why curing ecosystem blindness is essential for leaders today.
More: http://partneringresources.com/change-leadership-resources/
Public Engagement: Survive and Thrive in a Bigger Society Vol. 3Edelman Digital
The third volume of Edelman’s annual publication, Public Engagement: Survive and Thrive in a Bigger Society, is a collection of thought pieces written by the UK team in which we continue to explore the shifting media, thought and working landscapes that we inhabit, as well as the increasingly complex relationship between businesses, brands, government, the media and society.
1) CEOs now see complexity, rather than change, as their primary challenge due to a highly volatile, uncertain, and complex global environment.
2) While 79% of CEOs expect complexity to increase further, some organizations have managed to turn greater complexity into financial advantage.
3) CEOs identified creativity as the most important leadership quality for navigating increasing complexity.
This document summarizes interviews with five industry leaders on pressing issues facing the hedge fund industry. The leaders discussed how due diligence processes have changed in light of recent events, focusing more on counterparty risk. They also addressed how changes in investor attitudes have affected their businesses and how increased transparency is important. Regarding regulation, opinions varied from mandatory registration to focusing on solid due diligence practices. Major changes foreseen in the next five years include increased concentration in the industry and some increased regulation.
This document provides a summary of the Rocket Model for building high-performing teams. The Rocket Model is a framework that consists of 9 components: Context, Mission, Talent, Norms, Buy-In, Power, Morale, Results, and Concluding Comments. It describes each component and what teams need to do to improve in each area. The model can be used to assess what is going well or poorly on a team and identify actions to enhance performance. Following the components in order is important as each drives the next. The model has helped hundreds of teams work more effectively together.
The document discusses how most CEOs feel unprepared for the rapidly escalating complexity in today's economic environment, which they see as substantially more volatile, uncertain, and complex, however a group of "Standout" organizations have consistently performed well by mitigating complexity. Global shifts like increased interconnectivity and the rise of new technologies are compounding complexity. While CEOs expect disruption to continue, they must find new ways to lead their organizations to succeed in this drastically changed world.
1) El documento describe los servicios de consultoría de una empresa llamada Asertys para ayudar a otras empresas a lograr la efectividad y la transformación organizacional.
2) Asertys ofrece cinco servicios principales: estrategia y alineamiento organizacional, enfoque en el cliente, organización efectiva, desarrollo del potencial humano, y gestión de la cultura y el cambio.
3) Cada servicio incluye una descripción del problema que intenta resolver y un enfoque integrado para abordarlo a través de la definic
Ederives is a company that provides information design, web development, and print media services. It has a team of graphic designers, web designers and developers. The company aims to build its own brand equity by providing high quality, technologically advanced work to meet client needs. Ederives offers services like web design, development, internet marketing, e-commerce development, print media like brochures and posters, and motion graphics. It has an offshore team, competitive prices, and focuses on customer satisfaction, diligence, reliability, and timely delivery.
Meet In The Middle’S Rally To Spread TheMiMCalallen
Meet in the Middle hosted a pep rally to spread awareness about ending the use of a hurtful word. The rally featured student and guest speakers as well as a dance performance to support acceptance, humanity, passion, and unity. The local news station filmed the event and interviewed club members about their campaign to erase the hurtful word.
Meet In The Middle Halloween CelebrationMiMCalallen
The Meet in the Middle club held a Halloween celebration where scarecrows brought pumpkins from a patch and everyone watched a presentation together. They had a party to celebrate both Halloween and a Special Olympics bowling competition, where everyone brought and shared snacks. A boy wore a Special Olympics track suit and looked sharp, and everyone had a good time at the event hosted by the Meet in the Middle club.
This document discusses leadership challenges during times of crisis. It contains interviews with experts on this topic, including David Gergen and Ram Charan. The interviews discuss how crisis forces change upon organizations, and how effective leadership is needed to guide companies through major changes. While crisis is difficult, it also creates opportunities to change business models and become more innovative. Examples are given of companies like Intel that adapted successfully during past economic downturns. Overall the document examines the balancing act of leadership during crisis - managing through major challenges while also pursuing new opportunities.
Los principales resultados de la edición 2016 de nuestra investigación sobre el impacto de las megatendencias y los cambios actuales en la agenda de transformación y desarrollo organizacional de las empresas.
The club met to make door hangers for a local nursing home and had fun hanging out with friends while crafting and creating friendships. They spent time together doing things for others in the community while also strengthening their social connections.
The document summarizes a report from Boyden Executive Outlook that finds companies' boards and CEOs are bringing in new leadership in key roles to execute new growth strategies as the economic situation improves in some markets. Demand for senior management is increasing again in the financial services and technology sectors. Boards are also recruiting new members with more experience to prepare for 2010. Across industries like consumer/retail, technology, cleantech, and life sciences, companies are selectively hiring executives to fill important positions and take their organizations to the next level.
Jenderal Soedirman adalah pahlawan nasional Indonesia yang berjuang untuk kemerdekaan Indonesia. Ia adalah Panglima dan Jenderal RI pertama pada usia 31 tahun, meskipun menderita penyakit paru-paru berat.
This document provides guidance for selecting terms in the Medical Dictionary for Regulatory Activities (MedDRA) when coding adverse events, medical history, indications, and other medical information. It outlines general principles for term selection including using the highest quality source data, selecting the most specific lowest-level terms, and not adding or omitting any information. The document then provides specific points to consider and examples for accurately selecting terms for various medical concepts like diagnoses, procedures, exposures, and social circumstances. Maintaining consistent term selection is important for meaningful analysis and sharing of medical data.
The document discusses the issue of whether boards of financial institutions should have more directors with industry experience. It notes some potential advantages such as understanding business drivers, risks, and the competitive landscape. However, it also discusses downsides such as the risk of "groupthink" and the difficulty of recruiting current industry executives. It concludes that while industry experience can be valuable, it was likely not a lack of it that caused governance failures during the financial crisis. Sound judgment, common sense, and independence will remain most important for effective boards going forward.
The document discusses the challenges facing global business leaders in the current economic downturn and opportunities that may arise. It notes that (1) the recession has emphasized how interconnected the global economy is, (2) companies must assess their core competencies and financing strategies in light of new conditions, and (3) leaders should view the downturn as a chance to innovate and learn from emerging market competitors. Success will require a global mindset and the ability to leverage opportunities across borders.
Alcoa endorses The Business Roundtable Principles of Corporate finance8
The document outlines principles of corporate governance established by The Business Roundtable. It discusses the roles and responsibilities of boards of directors, CEOs, management, stockholders, and other parties. The board's primary duties are selecting the CEO and overseeing management. Management runs day-to-day operations and informs the board of business status. Effective governance requires understanding these roles and their relationships with stockholders and other constituencies.
2012 q2 McKinsey quarterly - Put your money where your strategy isAhmed Al Bilal
The document discusses corporate strategy and capital allocation. It summarizes several articles in the McKinsey Quarterly, including ones on overcoming strategic inertia by reallocating resources, using social media strategically, and leveraging social technologies internally. It also previews pieces on better listening skills for executives and harnessing the potential of social media. The introduction notes that many companies fail to change their capital allocation to business units from year to year, despite changing environments, showing stagnant strategies.
This document discusses corporate governance for directors of emerging companies. It begins by providing background on corporate governance reforms over the past 10-15 years in response to corporate scandals. It then discusses key aspects of corporate governance including the roles and responsibilities of boards of directors, management, and shareholders. The document emphasizes that directors must understand corporate architecture and how power is divided to effectively fulfill their oversight duties while avoiding conflicts of interest. Overall, the document aims to educate directors of emerging companies on best practices for decision making, compliance, and maximizing corporate performance.
This is a paper from CIMA Chartered Institute of management accountants and I think it is brilliant. Talks about cost leadership, supply chain, innovation, employee engagament, shareholder value and how all this can support a long term strategy versus a short term strategy.
This article discusses the challenges of modern leadership. Successful leadership requires adapting to rapid shifts in the business landscape, where there is no precedent. Leaders must focus on developing "substance" by basing their strategy on a term of reference close to their personal values and legacy. This will allow them to guide their organization with conviction through an evolving environment. Key social and economic indicators suggest the current phase requires "age of substance" where organizations demonstrate transparency, authenticity, and speed in order to earn consumer trust and punish those who do not live up to expectations.
Business Law Training | Corporate Governance for Closely Held Businesses: Imp...Quarles & Brady
Many small or start-up companies may think they don’t need, or think they lack the resources, to follow formalities and maintain adequate documentation. However, to avoid potential liability and appropriately manage risk, all businesses – big, little, old, and new – must prepare, review, and update necessary business documents. Hear practical tips and insights for counseling clients and supporting their officers and boards.
The record of mergers and acquisitions have not been impressive all over the world. Most of these deals fail or are unable to achieve its projected growth and targets. The most common reason responsible for the failure of M&A deals are the cultural differences in the organisations. This paper discusses the reasons why most M&A deals fail with help of 2 examples.
A STUDY ON CORPORATE GOVERNANCE ISSUES AND DEVELOPMENTS.pdfRhonda Cetnar
This document discusses the history and development of corporate governance in India. It begins by discussing how corporate governance has become a prominent issue globally in recent decades due to several corporate scandals. It then provides historical context on the development of corporate governance practices and laws in India, noting that accountability has often been lacking. The document outlines several committees and reforms that have aimed to improve governance standards in India since the 1990s, including the addition of Clause 49 to listing agreements. It also discusses differences between governance in government corporations versus private companies in India.
The document discusses corporate governance in India, highlighting several key points:
1. Corporate governance issues are universal but particularly important in India due to features like family-run businesses, weak legal enforcement, and high ownership concentration.
2. Effective corporate governance promotes strong financial systems and economic growth by enhancing access to financing and investment while reducing risks.
3. The main challenges are ensuring managers serve shareholder interests and protecting minority shareholder rights in contexts like family businesses where interests may not align.
Whether corporate governance is a burden meant to report compliance on companies’ performance, or can it be used as a competitive advantage in view of the changing laws, awareness and scenario is the important question which is present in the minds of those at the top of the company affairs including the CEO, Directors and Boards.
The book under reference, “Boards that Deliver”, by Ram Charan attempts to answer this question in a certain and prudent manner. The author believes that with the right set of practices, any group of directors can become a board that delivers value to the management and to the investors and goes ahead to demonstrate his points giving directions on various steps to be taken to make this happen.
Promoter Leadership Vs Professional Leadership by Ajay Bhat Monnet IspatMukesh
Promoter Leadership Vs Professiona: The objective of this article is not to discuss the NPA problem as such but one of the essential causes why they happen.
Week 2 BUS 660 Contemporary Issues in Organizational Leadership.docxcelenarouzie
Week 2 BUS 660 Contemporary Issues in Organizational Leadership
Week 2 - Discussion 1
Ethical Leadership
Companies have become increasingly aware of the advantages that being ethically conscious have to offer, especially in the global economy. Using the overview of ethical leadership provided in this week’s lecture and readings, in what way can ethical business practices increase organizational competitiveness in their respective industries and help to further substantiate the notion that an ethical culture is good for business? Conversely, how does unethical leadership adversely affect the organization’s bottom line? What impact can a leader’s position on ethics have on the culture of an organization?
Week 2 - Discussion 2
Ethical Organizational Culture
What is the relationship between a leader’s responsibility for ethical behavior and the idea of an ethical organizational culture? Research a specific nonfictional leader of your choice and provide examples of the behaviors this leader exhibits that highlight the role of ethics in leadership. Answer the following in your post:
1. Can a leader’s public and private morality be distinguished? Should they be?
2. Can a bad person be a good leader?
3. Why is it important for leaders to demonstrate ethical conduct?
4. Which is more important for improving ethical values in an organization: a code of ethics, leader behavior, or employee training?
Week 2 - Assignment
Characteristics of Leader Effectiveness
The purpose of this assignment is to examine similarities and differences in characteristics of effectiveness for several familiar leadership roles. In a three- to four-page paper (excluding the title and reference pages)
· Identify the characteristics by which the effectiveness of the following leaders might be evaluated: an assistant coach, a teacher, and a minister. Prioritize and explain the rationale for these characteristics.
· Discuss the ethical issues or challenges associated with prioritization.
· Compare and contrast the extent to which there are unique or similar characteristics across the different roles, and the extent to which the criteria are measurable. For example, some of the characteristics you might identify for the role of assistant coach might include the leadership behind a team’s win-loss record, player perceptions, team morale, etc.
Your paper must be formatted according to APA style as outlined in the Ashford Writing Center, and it must include citations and references from the text and at least two scholarly sources from the Ashford University Library
2 Preparing to Lead
iStock/Thinkstock
Learning Objectives
After reading this chapter, you should be able to:
• Establish a personal commitment to excellence.
• Understand the importance of character in a leadership position.
• Relate personal characteristics and actions to leadership success.
• Undertake efforts to grow and change.
• Display the willingness to change personal behaviors.
• Assume the .
Delivering Results Growth And Value In A Volatile World 15th Annual Globa...Colin McKillop
This report is based on survey
interviews with the Top 104 Automotive CEOs across 31 countries, as well as in-depth interviews with CEOs from companies across the automotive value chain.
This document is the introduction section of the 13th Annual Global CEO Survey report. It summarizes the major impacts of the recent recession on business leaders and their strategies for moving forward. The recession caused widespread cost cutting, cash preservation, and job losses. Most CEOs recognize they could have anticipated the downturn sooner to better prepare. Looking ahead, business leaders are focused on organizational agility, balancing short-term actions with long-term growth investments, and establishing a new management agenda based on adjusting costs, capital structures, and risk practices. CEO confidence in revenue growth is rising but remains cautious, as they strive to keep debt low and liquidity high during continued economic uncertainty.
This document provides a sample code of best practices for corporate governance in Kenya. It discusses key principles such as the authority and duties of shareholders, composition of the board, and monitoring of management performance. Shareholders have the duty to ensure competent leadership, strategic direction, and compliance with legal requirements. The board should include a balance of executive and non-executive directors, including independent directors, and separate the roles of board chair and CEO. The board is responsible for oversight, receiving regular reports, and annually evaluating its own performance.
This document discusses various topics related to governance including definitions of governance and corporate governance, the importance of good governance, governance with software as a service (SaaS), examples of governance failures like Enron and Parmalat, and an example of corporate governance success at Abu Dhabi Commercial Bank. It provides definitions of governance and corporate governance. It outlines benefits of good governance like visibility of errors, reduced costs, and efficient processes. It also discusses how to craft a SaaS governance policy and challenges faced and addressed at Abu Dhabi Commercial Bank.
• • Academy ol Managemenf Executive. 2001. Vol 15. NoCreat.docxoswald1horne84988
• • Academy ol Managemenf Executive. 2001. Vol 15. No
Creating wealth in
organizations: The role of
strategic leadership
W. Glenn Rowe
Executive Overview
Wealth creation in entrepreneurial and established orgcrnfzafion.i is a complex,
challenging task in today's global and technologically advancing business
environment. Strategic leadership enhances the wealth-creation process in
enfrepreneuriai and established organizations, and leads to above-average returns.
On the other hand, managerial leadership will likely lead to average returns at best,
but is most likely to achieve below-average returns and destroy wealth. Organizations
led by visionaries who are not properly supported by strong managerial leadership
may destroy wealth even more quickly than organizations led by managerial leaders.
This article defines strategic leadership, differentiates among the concepts of
strategic, visionary, and managerial leadership, and examines the differential links
between the three types of leadership and wealth creation. When organizations
restore strategic control and allow the development of a critical mass of strategic
leaders, these leaders will be a source of above-average returns. The result will be
wealth creation for the employees, customers, suppliers, and shareholders of
entrepreneurial and established organizations.
Without effective strategic leadership, the
probability that a firm can achieve superior or
even satisfactory performance when confront-
ing the challenges of the global economy will
be greatly reduced.
^R. Duane Ireland and Michael A. Hitt'
As the entrepreneurial CEO of Starbucks,
Howard Schultz's strategic choices have com-
pletely changed the gourmet coffee market in
which Starbucks operates.^ When he bought
Starbucks from its original owners in 1987. there
were six stores and 100 employees. By 1996, Star-
bucks had grown to 1,300 stores and 25,000 em-
ployees, and was operating in North America
and Japan. By the end of fiscal year 1999, Star-
bucks had 2,498 stores (363 were licensed stores
and the rest company-owned) and 35,620 employ-
ees, with operations expanded into Canada and
the United Kingdom. Sales and profits grew by
more than 50 percent per year for six consecutive
years, and stock price rose tenfold from 1992 to
1997. These growth rates have slowed since 1997,
but are still impressive, with sales and profits
increasing 29 percent and 50 percent, respec-
tively, from 1998 to 1999, Schultz's philosophies
exemplify those of a strategic leader. His number
one priority is to take care of his employees,
since they are responsible for communicating
passion to Starbucks' customers. He believes
that if his employees do this well, Starbucks will
accomplish its mission of educating consumers
everywhere about fine coffee and creating an
atmosphere that will draw people into their
stores and "give them a sense of wonder and
romance in the midst of a harried life."^ In addi-
tion, the firm will provide long-term growth.
Chapter 1010.1 Leading an Ethical Organization Corporate Govern.docxbartholomeocoombs
Chapter 10
10.1 Leading an Ethical Organization: Corporate Governance, Corporate Ethics, and Social Responsibility
Learning Objectives
After reading this chapter, you should be able to understand and articulate answers to the following questions:
· What are the key elements of effective corporate governance?
· How do individuals and firms gauge ethical behavior?
· What influences and biases might impact and impede decision making?
TOMS Shoes: Doing Business with Soul
Under the business model used by TOMS Shoes, a pair of their signature alpargata footwear is donated for every pair sold.
Parke Ladd – Quinn’s new Tom’s – CC BY 2.0.
In 2002, Blake Mycoskie competed with his sister Paige on The Amazing Race—a reality show where groups of two people with existing relationships engage in a global race to win valuable prizes, with the winner receiving a coveted grand prize. Although Blake’s team finished third in the second season of the show, the experience afforded him the opportunity to visit Argentina, where he returned in 2006 and developed the idea to build a company around the alpargata—a popular style of shoe in that region.
The premise of the company Blake started was a unique one. For every shoe sold, a pair will be given to someone in need. This simple business model was the basis for TOMS Shoes, which has now given away more than one million pairs of shoes to those in need in more than twenty countries worldwide (Oloffson, 2010).
The rise of TOMS Shoes has inspired other companies that have adopted the “buy-one-give-one” philosophy. For example, the Good Little Company donates a meal for every package purchased (Nicolas, 2011). This business model has also been successfully applied to selling (and donating) other items such as glasses and books.
The social initiatives that drive TOMS Shoes stand in stark contrast to the criticisms that plagued Nike Corporation, where claims of human rights violations, ranging from the use of sweatshops and child labor to lack of compliance with minimum wage laws, were rampant in the 1990s (McCall, 1998). While Nike struggled to win back confidence in buyers that were concerned with their business practices, TOMS social initiatives are a source of excellent publicity in pride in those who purchase their products. As further testament to their popularity, TOMS has engaged in partnerships with Nordstrom, Disney, and Element Skateboards.
Although the idea of social entrepreneurship and the birth of firms such as TOMS Shoes are relatively new, a push toward social initiatives has been the source of debate for executives for decades. Issues that have sparked particularly fierce debate include CEO pay and the role of today’s modern corporation. More than a quarter of a century ago, famed economist Milton Friedman argued, “The social responsibility of business is to increase its profits.” This notion is now being challenged by firms such as TOMS and their entrepreneurial CEO, who argue that serving other stakeho.
Chapter 1010.1 Leading an Ethical Organization Corporate Govern.docx
The Changing Of The Board
1. No. 1, 2009
Board of Director Series:
The Changing of the Board
Boards In Crisis: Part One
Failures in governance contributed
significantly to the global disruption
of markets and economies in 2008.
We need to rethink and reshape corporate boards in
order to improve their ability to oversee organizations
that operate in complex and competitive business
ecosystems. The first priority for boards is to refocus
on shareholder value and restore shareholder trust.
Boyden global executive search
And
John Levy of Board Advisory
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2. Board of Director Series — No. 1, 2009 www.boyden.com
The Changing of the Board
Table of Contents
Introduction to The Changing of the Board
I Corporate Boards in Crisis
II A Brief History: Fighting for the Soul of the Board
III Shareholders Get Engaged
IV Transforming Boards for Competitive Advantage
Boyden’s Board of Director Series
Acknowledgements and Sources
About Boyden
About John Levy and Board Advisory
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3. Board of Director Series — No. 1, 2009 www.boyden.com
The Changing of the Board
Boards In Crisis: Part One
Introduction
The Changing of the Board is a series of the goal is to ensure boards act as trusted
four papers about the challenge of finding agents on behalf of shareholders. CEOs and
new directors for organizations that oper- company insiders often want to retain control
ate in today’s increasingly complex business of board agendas and board membership in
environment. These papers explore the chal- order to minimize opposition to their man-
lenge of practicing corporate oversight and agement decisions. Research suggests that
governance in a world of change. It is an is- companies do, in fact, become more profit-
sue of critical importance to the many clients able and achieve higher stock prices when
Boyden serves around the world. their boards are more independent and less
controlled by internal management.
Making boards (and those they serve) more
successful has become a priority for all who Shareholders were the big losers in the re-
participate in today’s global markets. That cent market collapse – inspiring them to be-
includes shareholders, stakeholders, corp- come more engaged in company affairs. The
orations, and customers – and the capital SEC recently voted to propose a comprehen-
markets as well. The four papers that sive series of rule amendments to
constitute The Changing of the Board facilitate the rights of shareholders to nomi-
offer fresh insight on how to construct nate directors to run against company-select-
boards that work. The series begins with a ed slates. This is another step in reducing the
concise overview of why boards fail. It conflicts of interest which often undermine
explains the meaning and value of board the commitment and effectiveness of boards
independence. And it describes the strate- in overseeing company management. New
gies needed to move boards from focusing research indicates that hybrid boards – com-
on compliance to creating competitive bining shareholder-supported directors with
advantage. management-aligned directors – are more
successful in improving company results and
Boards in Crisis, the first paper in the series, increasing shareholder value than traditional
focuses on corporate boards: past, present, CEO-controlled boards.
and future. Years of reform have improved
the capability and performance of boards. Some boards, like that of Costco, have
But not enough. The recent global crisis – proven very successful in proactively steering
and especially a failure of boards to manage their companies toward continuing success.
risk and compensation in financial services – Much progress has been made in moving
indicates a need for deeper and more from ceremonial boards to working boards.
thoughtful changes in the practice of corpo- The next challenge is to develop strategies
rate oversight and governance. This first pa- to move boards beyond mere compliance
per explores the reasons, both historical and to providing new levels of value. The board
contemporary, why shareholder interests of Costco, for example, is clearly an equal
have not received the attention they require. partner with internal management, and the
results have been excellent. Leading thinkers
Today the “fight for the soul of the board” such as Ram Charan, author of the acclaimed
continues as many shareholders seek more books Boards that Work and Boards that
independent boards, often asking that the Deliver, believe that building a great board
positions of CEO and Chairman be separated. may be the next big corporate advantage –
While both legislation (Sarbanes-Oxley) and and one of the few competitive advantages
regulation (requirements of NASDAQ and the that may be sustainable over many years.
National Association of Security Dealers) now
mandate that “independent” directors fill Corporate boards must do a better job of
key board positions, those directors may still delivering on the now centuries-old promise
see themselves as led by the CEO and his to protect and increase shareholder value. A
team. From the shareholder’s point of view, primary goal is building honest collaborative
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The Changing of the Board
relationships with internal managers, includ- Tipping points were passed. The dominos
ing occasionally temperamental CEOs; so began to fall.
they can work together to find better ways
to successfully navigate the accelerating First, the large financial enterprises that were
complexity of twenty-first Century business the foundations of the economy began to tot-
environments. ter then fail. As those institutions failed, other
interdependent corporations collapsed. The
Former Secretary of Labor Robert Reich demise of companies, one after another, cap-
makes our future shockingly clear in his new sized whole sectors. Whole economies were
book Supercapitalism. The global market- affected. The domino effect quickly crossed
place will only become more competitive, national boundaries.
more complex, and more unforgiving. Com-
panies no longer have time to waste on any Soon we found ourselves in a world of pain.
activity that will not improve products or gen-
erate profits. The underlying causes and ultimate effects
of these events will be studied for years. But
I. Corporate Boards In Crisis there is no denying that too few corporate
boards were prepared to deal decisively with
What happened to our companies and our critical events of this size, speed, and com-
world between January of 2008 and today? plexity. Too many CEOs and boards were late
in recognizing and mitigating risks.
The simplest way to comprehend the eco-
nomic meltdown of 2008 is to view it as a For most of us, governance is invisible until
“Boards own a large share of domino effect that occured on a global scale. it fails. The scope of the failure tells us the
the responsibility for the good
governance and management of scope of the change required to prevent
companies. It’s time they step up Instantaneous global communication, busi- similar failures in the future.
and do a better job of that”
ness complexity and hyper-competition all
Dinesh Mirchandani, Managing
Director, Boyden India came together to drive unrealistic business Few are comfortable with fundamental
expectations, models, and strategies. Those, change. But no one wants to see another
in turn, generated unintended and out-of- year like 2008.
control consequences.
• A continuing market emphasis on On the surface, governance appears simple.
short-term profitability distracted many Boards are responsible for overseeing com-
companies from focusing on long-term pany compliance, strategy, execution, and
sustainability. results. Many believe the buck stops with the
board when companies falter and sharehold-
• A need to deliver on projections of short- ers suffer.
term profitability helped create a global
market for financial derivatives. (Warren Beneath that apparently simple surface, how-
Buffet warned markets early in 2003 that ever, lurk historical issues that have made it
derivatives were “financial products of more difficult for directors to do their jobs.
mass destruction.”) Boards have been held responsible for cor-
“Too often boards have not porate governance, for oversight of manage-
represented shareholders. And • Supposedly sophisticated risk manage-
directors have waited too long to ment and business operations, and financial
push back when they have doubts ment systems failed to identify and
results, but too often directors were not
about management decisions” mitigate the potential downside of what
Sarah Stewart, Principal, given the access, tools, and support required.
appeared to be a booming market.
Boyden Pittsburgh Until 2002 (and the passage of Sarbanes-
• Business ethics were deemed irrelevant Oxley) boards were not truly empowered to
and pushed aside in many companies. access the information they needed to do
their job. By 2008 many boards had still not
• Control systems (governing institutions, changed culture and practice enough to uti-
regulators, and corporate boards of di- lize their new powers.
rectors) were gradually eroded, compro-
mised, and eventually overwhelmed.
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The Changing of the Board
The SEC, in announcing recent proposals to be encouraged to become more diligent in
strengthen shareholder participation in board carrying out their duties. Changing regula-
elections, noted that the economic crisis tions will not change results unless boards
“has led many to question whether boards and directors change their behavior as well.
of directors are truly being held accountable
for the decisions that they make; whether “You need to be capable of deep, mature
boards are exercising appropriate oversight thought and the persistence of action to in-
of management; whether boards are appro- fluence change as a board member,” says
priately focused on shareholder interests; Dinesh Mirchandani, Managing Director of
and whether boards need to be held more Boyden India. “This is a responsibility that
responsible for their decisions regarding such falls squarely on the next generation of
issues as compensation structures and risk board members.” But who will identify
management.” and recruit that next generation? How long
should boards wait to make changes? And
Not everybody is critical of everything that what are the most urgent concerns?
happens in the boardroom. “Boards have
generally done a better job than people give “The most critical role for boards now is to
them credit for. One of the major problems restore trust,” says John Levy. “That is what
is that the expectations of stakeholders are we need to do. We need to get that fixed.”
often unrealistic,” states John F. Levy, CEO
of Board Advisory, a member of the board
of directors of five public companies, and a II. A Brief History: Fighting for the
frequent author and speaker of boards and Soul of the Board
corporate governance. While some commen-
tators and shareholders believe that directors Ideally, CEOs and independent directors
are responsible for company results regard- should be working together to restore trust
less of what is happening in the business by improving shareholder value. Sometimes
environment, many professionals who work they do. More often they do not. For decades
with boards say the public has unrealistic there has been a battle over who controls the
expectations of what directors can accom- board, who sets board agendas. In too many
plish. “The role of the director is not well cases, that battle has been between the CEO
understood. It doesn’t matter how intelligent, and the shareholders.
dedicated or competent they are,” says
Levy. “No director can be everywhere and Corporate investment structures were intro-
do everything within a company. Board mem- duced four hundred years ago to facilitate
bers are not ‘supermanagers.’ Their role is long-term investment in enterprises with
oversight, not management.” substantial capital needs. The first such
entity was the Dutch East India Company.
Everyone wants boards to be better. And In exchange for providing long-term capital,
many boards are better. Directors have been investors received partial ownership in the
working longer hours than ever before. Many form of “shares” which could be sold when
boards are now more persistent in asking they wanted to cash out. Investors thus
questions and demanding answers. But, became “shareholders.” Later legislation
as the financial events of 2008 continue to provided corporations with separate identity
remind us, boards simply have not been and rights in perpetuity. This model proved
better enough. highly successful in attracting capital and in
driving the growth of businesses over the
That is why institutions responsible for main- next few centuries.
taining regulatory guidelines for corporate
boards of directors must rethink and refine Initially, directors were shareholders elected
frameworks for governance in order to by their peers to oversee the investment.
ensure corporate boards are properly staffed The practice of selecting well-known mem-
and fully resourced. In addition, boards must bers of the business community to be fair
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The Changing of the Board
third-party observers was introduced shortly rubber stamping are rapidly coming to an end
thereafter. Professor Robert Tricker, the au- as independent directors begin to flex their
thor of Corporate Governance – Principles, muscles and adopt best practices in corpo-
Policies and Practices published by Oxford rate governance.”
in 2009, says their role was to assure share-
holders that investments were properly uti- Sarah Stewart, a Principal with Boyden Pitts-
lized, so shareholders would trust companies burgh, and an expert in governance issues,
with their money. In practice, however, direc- agrees. “Not many CEOs have the confi-
tors were appointed by senior management dence to come to a board without having all
and so rarely disagreed with them. Being a the answers in place. But that’s what it really
director paid well for duties that were largely takes. It’s critical to bring the board in earlier.
ceremonial. It’s an act of courage for a CEO to do that.
But that’s the only effective way to involve a
The genius of the board system is that it es- board in strategy and also get the benefit of
tablished third-party governance in order to the directors’ collective experience.”
override the self-interest of management and
individual shareholders in favor of assuring Boyden’s Mirchandani believes the problem
safety and fairness to all shareholders. With- exists in India as well. “Board members here
out such oversight, capital markets could have too often functioned as ‘yes-men’ of the
not exist. But there is a fundamentally unre- Chairman, CEO or promoter. Satyam [a lead-
solved issue in the system: “The Principal- ing Indian outsourcing company that for years
Agent Problem.” The principal (in our case signficantly inflated its earnings and assets] is
the shareholder) depends on payment to the a clear example of that.”
agent (for this purpose the director and the
board) to motivate the agent to perform the The Chairmen’s Forum, an influential group of
activity desired by the principal. more than 50 current and former board chair-
men, recently endorsed a new report which
The difficulty is the principal (shareholder) suggests that separating the roles of CEO
lacks sufficient knowledge of what will mo- and Chairman of the Board is essential to
tivate the agent (the director and the board) “restoring market trust in the enterprise.”
to perform the required service (watching Published by Yale’s Millstein Center for
out for and growing shareholder value). Corporate Governance and Performance,
Equally difficult for the principal is that while “Chairing the Board” says independent
the agent knows what the agent has done, board chairs are the best way to compel
often there is not enough information for the CEOs to focus on shareholder issues and
principal to understand if the activity was to curb senior management conflicts of
actually performed and if so, how well. The interest. The report emphasizes that
Principal-Agent problem continues to be “managing the board is a separate and
a fundamental issue for shareholders and time-intensive responsibility.”
boards. The realistic shareholder entertains a
healthy suspicion that their interests are not In the UK the number of CEOs chairing the
being protected. board has been reduced to only 5% of FTSE
350 companies. A study in Canada showed
Amazingly, virtually no one paid much atten- two-thirds of public companies were already
tion to boards of directors until 1971 when using independent board chairmen by 2003.
Harvard Professor Myles L. Mace published According to “Chairing the Board” the
Directors: Myth and Reality. This classic US has been slower to take this key step
study revealed directors did not, in fact, es- towards reforming boards. BusinessWeek
tablish the policies of the firm, rarely chose recently identified 16 percent of US boards
the CEO, rubber-stamped compensation as having truly independent chairmen in
decisions, and were not inclined to ask tough 2008. The magazine said many non-executive
questions. Tom Flannery, Managing Direc- chairs were actually either ex-CEOs of the
tor of Boyden Pittsburgh says, “The days of company or otherwise related to internal
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7. Board of Director Series — No. 1, 2009 www.boyden.com
The Changing of the Board
management, and thus might lack full inde- by company insiders. The new regulations
pendence. require sponsoring shareholders to own a
not-insignificant share of company stock, but
Boyden’s Stewart emphasizes that “whoever they will add another way to move boards
controls the board agenda controls the board. to have more independence. It is interesting
Boards have been and must be more vocal to note that a study that tracked the perfor-
about what it is they want to work on.” mance of 120 hybrid boards (boards which
mix independent directors with traditional
directors selected and supported by com-
III. Shareholders Get Enraged pany management) formed between 2005
and Engaged and 2008 demonstrated that hybrid boards
of directors are able to increase share values
Millions of shareholders suffered signifi- faster than traditional boards.
cant losses in the 2008 meltdown of world
markets. Some lost as much as half of the
previous value of their equities. Enraged IV. Transforming Boards for
shareholders can and do become engaged Competitive Advantage
shareholders. Shareholder activism existed
long before the events of 2008, but recent “Every board is different,” emphasizes Boy-
events have caused activists to assert more den’s Stewart. “That’s because every com-
independent control over boards. pany is different.” But it is clear that fixing
board problems is on everybody’s agenda.
Shareholder advocates believe the best way A recent McKinsey Quarterly report on the
to assure that boards focus on protecting state of the corporate board indicates boards
shareholder value is to put directors in place are becoming more active, engaged, and
who are committed to doing just that. Board striving to make significant efforts to reform.
fights are expensive and hard to win, but Boards surveyed by McKinsey are review-
shareholders have had enough victories in ing current company performance, risk, and
the past to allow researchers to measure financials. They are approving strategy. And
how shareholder-focused boards perform. they are tracking progress against strategy.
Studies indicate shareholders fare significant- Directors who say they want more time to
ly better when boards become independent focus on strategy, are directors who are
enough to make shareholder interests their becoming increasingly ambitious about pro-
most important priority. viding more value to companies. They also
would like to spend more time developing tal-
“Corporate Governance and Equity ent for succession planning.
Prices,” a study by Gompers, Ishii and Met-
rick, showed that firms with stronger share- Independent directors complain of being
holder rights (associated with independent frustrated by an inability to obtain a broader
boards) were more profitable and had higher range of information. Too often, they are not
stock valuations. Firms where boards and allowed to seek information from employees
policies were controlled by CEOs tended to lower in the company hierarchy. Theoretically
be less profitable and had lower stock valua- independent directors have a right to ques-
tions. This appeared to be because CEO-con- tion any employee, but sometimes senior
trolled boards tended to be more expansive, management discourages direct contact.
making more corporate acquisitions and hav- The question is how can boards do a good
ing higher capital expenditures. job of oversight without access to all crucial
information?
Recent SEC proposals to strengthen share-
holder participation in board elections should Ram Charan described the path boards follow
make it easier for shareholder-sponsored di- in evolving from simply being competent to
rectors to run against director slates chosen
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8. Board of Director Series — No. 1, 2009 www.boyden.com
The Changing of the Board
providing high value services for companies. petitors. An evolved board is positioned to
He says the initial changing of the board in- help do just that.
volved moving it from ceremonial status to
“liberated” status where it could play a more Overcoming the historical issues, empower-
significant role in governance. Sarbanes-Ox- ing boards and working through conflicts with
ley assured boards would now have access CEOs all require significant and sincere ef-
to information, but relationships between fort. Many organizations aren’t willing to de-
board and management are often negotiated vote the effort. The events of 2008 revealed
and formal. In these circumstances, board too often companies lack boards able to
governance is done mainly through compli- make a difference when times got tough. But
ance activities. boards that are able to evolve to a higher lev-
el of play, boards with directors who are able
New opportunities are created as boards to establish respectful collaboration and a
enter a third phase Charan terms “progres- level of trust with the C-Suite will themselves
sive.” This is characterized by increasing become a significant competitive advantage
dialogue and trust between independent for their companies.
directors and senior management. Charan
says self-assessment processes are used As the recent McKinsey survey shows, many
to work though performance and partnering directors are hungry for the challenge. They
issues. Transparency begins to improve as are absolutely prepared for the changing of
information now tends to be made available the board.
in more useful forms. Directors are thus able
to learn how the business really runs. They
finally have enough information to have more
relevant discussions with management. Boyden’s Board of Director Series
Though CEOs may not admit it, says Joseph This Boyden paper Boards in Crisis is the
Daniel McCool, author of the recent book first of a sequence of four on The Changing
Deciding Who Leads, CEOs can use all the of the Board.
help they can get. “I think there are a lot of
global companies that cannot be led by one Better Directors for Better Boards, the
person alone. The CEO role has become too next in this series focuses on the chang-
complex, too global, and too demanding for ing world of the board director. Traditionally
individuals. Individual executives need to board membership was largely a well-paying
have the courage and honesty to acknowl- ceremonial job reserved for friends of man-
edge they can’t do it all.” Today’s manage- agement. Since legislation and listing regula-
ment is in great need of board perspective, tions introduced in 2002 and 2003, directors
experience and balance in order to determine are expected to do real work. Most have
how to continually improve strategies and additional responsibilities including serving
operations. on board committees, like auditing or com-
pensation. As pressure (and sometimes bad
Virtually all companies now struggle to catch publicity) increases, many board members
up to the growing complexity, speed, and choose to leave boards early. This paper in-
globalization of business. As boards and cludes a special interview with “Director X,”
CEOs are active partners more often, the an experienced board member serving as a
potential for new value and new ways to cre- Director of two high profile companies, who
ate competitive advantage increases. Reich provides a surprising and unique look at what
points out that most components in business really takes place in the boardroom in a crisis.
value chains are now rapidly commoditized. Director X describes how the responsibilities
Markets are becoming level playing fields, of directors changed, including the bad and
resulting in extreme levels of hyper-compe- the good, and what shifted the day Sarbanes-
tition between companies desperate to find Oxley became law.
ways to differentiate themselves from com-
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9. Board of Director Series — No. 1, 2009 www.boyden.com
The Changing of the Board
Boards recognize that in the future they will Boards Get Real is the fourth and final paper
need different kinds of board members than in Boyden’s series. It explores the new ability
those who served in the past. Gone are the of boards to obtain independent resources.
“feel good” celebrity directors. In the future, Boards may be still be hesitant to use them,
boards will increasingly require experienced but for the first time in history, boards
directors with solid knowledge of relevant finally have significant opportunity to practice
business domains — and companies will the oversight that has long been promised.
seek candidates who are tech-savvy, and Something as simple as assuring accurate re-
have expertise in new areas such as risk porting of quarterly results has been surpris-
management and business continuity. As ingly difficult. There is also the ever-present
more directors resign early, there will be a temptation to over-state business results in
growing shortage of qualified candidates. In order to trigger bonuses. Nearly 1200 public
addition, it may be even more difficult to find companies in 2005 had to restate business
new directors if director liability is increased. results (as opposed to 270 public companies
What this means is that “The War for Talent” five years earlier). Nothing compromises the
has finally come to the board room. Compa- trust of capital markets and shareholders
nies will increasingly rely on retained search more quickly than inaccurate reporting of
to find directors capable of helping a board business results, but board members them-
become a competitive advantage. selves lack time to assure accurate reporting.
The third paper in the series is Why Eth- Few members of the public are aware that
ics Are Not Optional. The work of a board boards have direct responsibility for prevent-
member always begins with a deep under- ing, discovering, and investigating significant
standing of the unique duties of directors, fraud associated with company employees,
both legal and ethical. The board is responsi- agents, or customers. Until 2002 and the
ble for understanding, defining, and maintain- passage of the Sarbanes-Oxley legislation (as
ing ethical frameworks to guide all employ- well as additional requirements established
ees and agents of the company, as well as by stock exchanges), boards of directors
circumscribing company business practice. lacked sufficient resources to accomplish
Creating an ethical “tone at the top” turns this. Passage of the much-criticized legisla-
out to be one of the most important duties of tion is considered by many experts to be
directors. Leading by example is the most ef- the most successful act of empowering US
fective way to assure an ethical organization. corporate boards in the history of corporate
governance. Sarbanes-Oxley gave boards the
History has shown what can happen when a legal responsibility to assure business infor-
board like the Enron board (then considered mation was correct and business operations
one of the best boards in America) sets eth- legal. But it also allowed boards the right to
ics aside whenever senior executives ask. An retain outside auditors and other resources to
interview with John F. Levy, CEO of Board report directly to the board.
Advisory, who often consults for compro-
mised companies and troubled boards, de-
The question remains why, if boards now
scribes how returning to ethical frameworks
have sufficient external support to provide
enables companies to restore shareholder
real oversight, did so many prove ineffective
trust. Levy, a participant in authoring “The
in the financial crisis of 2008? It appears “the
Changing of the Board” series, empha-
changing of the board” will require more than
sizes that the value of rebuilding customer
legislation and regulation. Companies, boards
trust and company reputation will always far
and individual directors must all be willing
exceed the cost and effort of doing so. It is
to make the commitments and changes
clear that good ethics is good business.
required to protect shareholders and capital
markets.
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10. Board of Director Series — No. 1, 2009 www.boyden.com
The Changing of the Board
Acknowledgements and Sources
BACK TO THE DRAWING BOARD by Colin B. Carter and Jay W. Lorsch, Harvard Business School
Press, Boston, 2004
BOARDS AT WORK: How Corporate Boards Create Competitive Advantage by Ram Charan,
Jossey-Bass, San Francisco, 1998
BOARDS THAT DELIVER: Advancing Corporate Governance from Compliance to Competitive
Advantage by Ram Charan, Jossey-Bass, San Francisco, 2005
CHAIRING THE BOARD: The Case for Independent Leadership in Corporate America,
Millstein Center for Corporate Governance and Performance, Yale School of Management,
New Haven, 2009
CORPORATE GOVERNANCE AND EQUITY PRICES, by Paul Gompers, Joy L. Ishii, and
Andrew Metrick, Quarterly Journal of Economics, Vol. 118, No. 1, pp. 107-155, February 2003.
CORPORATE GOVERNANCE: Principles, Policies and Practicies by Bob Tricker, Oxford
University Press, New York, 2009
CORPORATE GOVERNANCE WEBSITE. http://www.corpgov.net/index.htm
DIRECTORS: MYTH AND REALITY by Myles L. Mace, Harvard Business School Press, Boston,
1971 and 1986. (Out of print.)
HARVARD BUSINESS REVIEW ON CORPORATE GOVERNANCE, including article
“Redrawing the Line Between the Board and the CEO.” Harvard Business School Press,
Boston, 2000
SEC Votes to Propose Rule Amendments to Facilitate Rights of Shareholders to Nominate
Directors, SEC press release. http://www.sec.gov/news/press/2009/2009-116.htm
SUPERCAPITALISM by Robert Reich, Random House, New York, 2007
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11. Board of Director Series — No. 1, 2009 www.boyden.com
The Changing of the Board
About Boyden
Boyden is a global leader in the executive search industry with more than 70
offices in over 40 countries. Founded in 1946, Boyden specializes in high level
executive search, interim management and human capital consulting across a
broad spectrum of industries. For more information, please visit www.boyden.com.
About John Levy and Board Advisory
John F. Levy is Chief Executive Officer and principal consultant for Board Advisory, a consulting
firm that assists public companies, or companies aspiring to be public, with corporate governance,
corporate compliance, ethics, financial reporting, and financial strategies. Mr. Levy has 30 years of
progressive financial, accounting and business experience, including having served as Chief Finan-
cial Officer of both public and private companies.
As a frequent speaker on the roles and responsibilities of board members and audit committee
members, Mr. Levy has authored “Focus on Corporate Ethics: Legal and Ethical Responsibilities of
Board Members,” a course on the ethical and legal responsibilities of board members initially pre-
sented to various state accounting societies.
For additional Information about Board Advisory and John Levy, visit boardadvisory.net
Special thanks are due to communications firm Margolis & Company for its perspective
and support, particularly Dan Margolis and Sheldon Renan.
Boyden Working Papers on Leadership is a new series of publications on innovative thinking
and best practices for corporate leadership today. These working papers provide a foundation for
discussion internally and externally, with multiple views of leadership that include sector-specific
and global perspectives. Boyden Working Papers may be quoted or republished through internal
or external channels. For further information, please contact Gray Hollett, Vice President, Global
Marketing at Boyden — ghollett@boyden.com.
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