Year in Review II.
By James Kristie

W e l c o m e to t h e s e con d a n n u a l “ G o v e r n a n c e Year in Review” special e d i t i o n o f Di r e c to r s & Boards. We added this fifth issue in our quarterly publication schedule to deliver even greater value to our read- ers. We present to you an archival record of the who, what, where, when, and why of governance — the 5W’s that moved the governance ball forward (or, sad to say, backward) in each calendar year. I think you’ll find that our roster of au- thors in this issue, supplemented by our data compilations, convey a comprehensive portrait of governance circa 2007. Let me start this issue of f w i t h a m i n i - com p i- l a t i on of my ow n . Here are a few one-liners from articles that appeared in these pages last year. Read- ing them again, I see how e m b l e m a t i c t h e y a re o f the year just passed as well as the kind of counsel on governance best practices that Direc- tors & Boards has specialized in since its founding in 1976: • “The ideal CEO/board relationship is always candid and ‘in the moment,’ al- lowing for some ‘thinking out loud’ on exploratory topics — and, above all, early disclosure by the CEO of potential trouble spots.” — Lewis Campbell, chairman and CEO of Textron Inc., Q1 issue • “EBITDA is one of the nastiest ac- counting inventions ever, since it pretends interest expense doesn’t matter.” — Gary Sutton, columnist (“Sutton’s Laws”), Q2 • “ NIFO (noses in, fingers out) may be an indefensible standard for board behav- ior in the post-Enron era.” — Mark Sick- les, board adviser, Q2 • “An internal investigation that neces- sarily invades the sanctity of the board- room is sensitive, difficult, and dangerous.” — George Stamboulidis, former federal prosecutor now with Baker Hostetler, Q3 • “Think about what drives each mem- ber of your board and how you can use this insight to keep ever yone engaged.” — Tom Roberts, Summit Partners, Q3 • “It’s pretty clear that boards can no longer ignore the voices of activist share- holders.” — Doug Raymond, columnist (“Legal Brief ”), Q4 • “Some people think they always will have power all the time, but they won’t.” — Robert Dilenschneider, D i l e n s c h n e i d e r G r o u p chairman and author, Power a n d In f l u e n c e : T h e Ru l e s Have Changed, Q4 • “Private equity investors and publicly traded com- pany boards are both trying to determine the answer to one key question in select- ing a CEO: Is the p erson truly a leader?” — Harry M. Jansen Kraemer Jr., former Baxter International CEO now with PE firm Madison Dearborn Partners, Q4 The year 2007 will be remembered as one of great highs and lows — for the fi- nancial markets, for individual company performance, and for the rigor of board oversight of management and responsive- ness to shareholders. Thus the theme of this annual report: “From the high ground to the depths.” Join us on the following pages as we capture the developments and spirit that moved board members, top management, and shareholders to action in the pivotal year just passed. directors & boards ® Editor’s not E James Kristie Editor and Associate Publisher Barbara Spector Hoffer Kaback Kelly McCarthy Contributing Editors Jerri Smith-Baldwin Accounting Bill Cooke bill cooke + company Design & Production Published by MLR Holdings LLC Milton L. Rock Chairman Robert H. Rock President Lisa M. Cody Chief Financial Officer Editorial and Business Offices 1845 Walnut Street, Suite 900 Philadelphia, PA 19103 Telephone: 215-567-3200 Fax: 215-405-6078 E-mail: Publishing Director David Shaw grid media llc Telephone: 301-963-6162 E-mail: Advertising Scott Chase grid media llc Telephone: 301-879-1613 E-mail: Subscriptions/Fulfillment Barbara A. Wenger Telephone: 215-405-6072 E-mail: Directors & BoarDs (ISSN 0364-9156) is published quarterly, ©2008 by MLR Holdings LLC. All rights reserved. No portion of this publication may be reproduced in any form whatsoever without prior written permission from the publisher. Subscriptions are $325 per year in the U.S.; $350 (by air) elsewhere. Article reprints – Contact Jerri Smith at 215-405-6071. Year in Review II

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