CHAPTER three
Best Practice Contradictions
“The independent directors were smart enough, but the issues were so complex that they didn’t stand a chance in the time available.”
— BOARD ADVISER
“ If a board sets itself up as a policeman, they won’t find the CEO very forthcoming with information.”
— CEO
“The recent scandals suggest that the idea of aligning directors with shareholder interest by having them own shares is not working.”
— FINANCIAL REPORTER
UUNDERLYING THE BEST PRACTICES WE DESCRIBED in chapter 2 are five basic assumptions about the requirements for board effectiveness. These assumptions, which are generally shared by directors, investors, regulators, and other advocates for board improvement, are as follows:
- Most of the directors ...
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