On a day that featured a series of conversations highlighting the advantages and drawbacks of shareholder capitalism, one of the highlights was surely the square-off between Lawrence Cunningham and Jeffrey Sonnenfeld, who shared their visions of the purpose of a corporation, their thoughts on why stakeholder activism has made the debate so intense and the director’s role in a landscape that features heightened stakeholder expectations.

About half of the 700 directors surveyed by PwC for its Charting the Course Through a Changing Governance Landscape report would replace at least one member of their board if they had their druthers. Nearly 20% said that they would replace two or more.

As part of its 2023 Governance Outlook: Projections on Emerging Board Matters, the National Association of Corporate Directors surveyed more than 300 directors on their expectations for the coming year as well as what areas they deem as important for their boards.

Director, AMN Healthcare, Barnes Group Inc., Destiny Transformations Group, Masonite International; author, Win When They Say You Won’t: Break Through Barriers and Keep Leveling Up Your Success

What Directors Are Thinking

Ertharin Cousin

Independent Director: Bayer SA, Mondelēz

Retaining your best talent may require adjusting for market volatility.

Many companies are facing significant challenges developing and implementing compensation programs for 2023 owing to market volatility and continued macroeconomic uncertainty. Decreased valuations put pressure on dilution and equity grant strategies, and calendar-year-end companies are considering modifications to annual incentive designs to recognize uncertainty around the macro environment, interest rates and inflation. 

Directors on the audit committee will be occupied with matters related to ESG, the economy and cybersecurity.

Former Chief Justice Leo Strine weighs in on the stakeholder vs. shareholder primacy debate.

What is the ultimate purpose of the board at a time when stakeholder interests have taken on more prominence?