"Paul Brountas′s book on corporate governance is an outstanding and welcome achievement. For those who serve as directors and those who aspire to become directors, his book provides an insightful, easy–to–read, commonsense guide to creating and maintaining excellence in America s boardrooms."
Raymond S. Troubh, recipient of the National Association of Corporate Directors 2003 Director of the Year Award
"Boardroom Excellence is a must–read for corporate management and directors, particularly in today s business climate. It is well written, well organized, and specifically instructional. The quality of the observations and authority of the author add importance to its value."
William Elfers, founder, Greylock Partners
"Frankly I shudder when I see an article or book with the term ′governance′ anywhere in the title or subtitle. I think that Paul Brountas has achieved three rarities: wisdom there is a style that condemns nobody, but which politely suggests situations in which one might pay attention; literacy short sentences, brief paragraphs, and well–defined separate chapters; but above all else charm. This is not pompous, it is not preachy, it is not from ′on high.′"
Robert A.G. Monks, founder of Hermes Lens Investments and Institutional Shareholder Services; cofounder of The Corporate Library
Foreword by Senator Paul S. Sarbanes xi
Note on This Book by Jeffrey Rudman xv
Chapter 1 How Did It Happen Or Was It Always This Bad? 6
My bleak historical portrayal of corporate America is not intended as a blanket condemnation of all publicly traded U.S. corporations.
Chapter 2 Duty of Care and Duty of Loyalty 25
It is the right, and obligation, of every director to be informed and to act deliberately, with the diligence and competence of a reasonably prudent person in a similar situation under similar circumstances.
Chapter 3 Role of the Board of Directors 33
Excellent companies stay excellent by regularly challenging themselves.
Chapter 4 What Values and Qualities Should Directors Possess? 49
The board has no room for insouciant directors who are not committed or who believe they can serve by being passive observers.
Chapter 5 Role of the CEO 61
The CEO should seek to create a board meeting environment that encourages skepticism and serious discussion and enables board members to disagree constructively.
Chapter 6 Board and Committee Meetings 71
Avoid information overload and mind–numbing presentations.
Chapter 7 Committees of the Board 85
Excessive CEO compensation is the "mad cow disease" of American boardrooms.
Chapter 8 Guidelines, Ethical Codes, and Legal Compliance 103
What is needed is a proactive CEO whose message resonates throughout the corporation and instills all employees with the resolve to help create a corporate culture that nourishes integrity and ethical behavior, penetrating all aspects of the corporation s business and governance.
Chapter 9 Revolt of the Stockholders 111
The 2003 and 2004 proxy seasons will be remembered as the time when stockholder activists took steps to change the way their corporations are governed, their directors are nominated, and their executives are compensated.
Chapter 10 Evaluation of Board Performance 127
Self–assessment of directors performance is receiving increasingly wide acceptance as board members realize that they are in the best position to evaluate their board performance.
Chapter 11 Effect of Sarbanes–Oxley on Private Corporations 135
Good corporate governance is good for business, whether the business is large or small, public, private, or even nonprofit.
Chapter 12 Nonprofit Entities 139
Trustees and directors of nonprofits would be well advised to consider adoption of changes in their ethical guidelines and codes of conduct along the lines currently favored by profit–motivated corporations.
Chapter 13 Model Board of Directors 143
The model board s membership includes individuals with diverse talents, experiences, personalities, instincts, and expertise that provide the composite skills that produce excellence in the boardroom.
About the Author 153