Chapter 1The Changing World of Board GovernanceHow We Got Here
- How and Why Boards Have Changed
- A Barometer for CEO Compensation
- Why Pay Ratios Have Changed Radically
- A Board Governance Tipping Point
- Impact of the 2008 Financial Meltdown
- Chapter Summary and What's Next
One of the principle tenets of our consulting work is that every board is operationally and culturally unique. It is this simple fact that makes constructing a single, all-inclusive set of board governance best practices an impossible task. Therefore, the guidance in this book is not positioned as a set of “hard and fast” rules or universally applied “must have” characteristics. Rather, the guidance is based on a flexible framework approach that allows boards to meet their fiduciary and governance duties while remaining responsive to the real cultural dynamics that directly influence the quality and consistency of decision making.
A framework approach also has a second advantage: it allows boards to respond appropriately to an ever-changing external socioeconomic and political landscape. This is an important point, since society's swiftly moving cultural currents, along with the ebb and flow of an economy's strength, has a profound impact on the performance expectations of corporate boards. Of course, this is no grand revelation to anyone reading this book, but we believe these concepts are important to keep in mind as context for the board governance recommendations made in the pages ...
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