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Charting a New CourseIssue: 2020 Annual ReportJohn Chidsey has both depth and breadth to his 25-year career. Currently the CEO of Subway, the privately owned franchiser of Subway sandwich shops, he was formerly the chairman and CEO of Burger King, a public company. He helmed Avis and Budget car rental companies and Jackson Hewitt, a tax-prepara...
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Two views — Reopening Risk: What are the legal liabilities?Issue: 2020 Annual ReportMany states have begun lifting the emergency orders issued to reduce COVID-19 transmission rates. Governors in these states are making calculated decisions, weighing the risks of a spike in infection rates against the risks of further economic decline and other adverse effects of lockdown orders. Bu...
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Two Views — Reopening Risk: What are the legal liabilities?Issue: 2020 Annual ReportThe world is facing an unprecedented pandemic and economic crisis. Our rules of social and business interaction are in flux. Markets gyrate wildly on random news. In some ways, stockholder lawsuits seem misplaced.A board should be safe legally if it acts sensibly in “reopening.” However, it is impor...
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Retaining Top Talent and Building Bench StrengthIssue: 2020 Annual ReportWhen the history books chronicle the performance of corporate America during the COVID-19 pandemic, they’re likely to detail which captains of industry were wearing a swimsuit when the tide went out, to borrow a phrase from investor Warren Buffett.The pandemic has thrown into stark relief the crucia...
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Where Does ESG Fit in Times of Crisis?Issue: 2020 Annual ReportBusiness, legal and governance journals are replete with articles illustrating how crises reveal the true character of companies and their leaders. The COVID-19 pandemic and social unrest sparked by deadly police brutality against minorities confirm that this adage holds just as true when it comes t...
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Supporting Black Leaders in Corporate AmericaIssue: 2020 Annual ReportAuthor’s Note: This essay was prepared before the death of George Floyd and the protests and important public discussions that followed. If anything, it is even more relevant now.The Center for Talent Innovation (CTI) recently released a study entitled “Being Black in Corporate America.” The finding...
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Working Inside the System: Black directors stand up for the future of corporate America.Issue: 2020 Annual ReportThe death of George Floyd, caught on camera, became a tipping point for some of the world’s largest companies, as they released a variety of statements about police brutality, racism and diversity. But if these statements are to be more than mere public relations moves, corporate America will have t...
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What’s Next? Directors face a host of questions in reopening and recovery.Issue: 2020 Annual ReportWhile the world still reeled from the COVID-19 pandemic that brought economies to a halt, passionate protests broke out against racial injustice following the death of George Floyd in Minneapolis, and the subsequent charges against a police officer responsible for that death. Either event would be c...
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Board Considerations: Returning to the Workplace and Navigating the “New Normal”Issue: 2020 Annual ReportBoth experienced directors, Nina Henderson and Jim Hunt agree that when it became clear that COVID-19 was going to upend the businesses on whose boards they serve, it became an “all-hands-on-deck” situation involving shutting down sites and converting to a work-from-home model for most employees.Hun...
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Compensation Issues in the Recovery: Setting CEO and Senior Management CompensationIssue: 2020 Annual ReportCompensation during recovery from COVID-19 will be under great scrutiny, whether it’s from actions by executives and directors to reduce their own pay, short-term and long-term incentive considerations, or the recalibration of metrics for near-term incentives. This scrutiny will come from both inter...
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Refreshing the Board and the Executive Suite After the CrisisIssue: 2020 Annual ReportOnce the pandemic calms and corporations have moved from business triage back to strategies for future growth, there’s no doubt that the decisions and actions of company leadership and the board will be scrutinized. Was the CEO an effective leader? Did the board fulfill its duties as an adviser to t...
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ESG: Before, During and After the CrisisIssue: 2020 Annual ReportEnvironmental, social and governance (ESG) issues have largely focused on the “E” and the “G” because those are more easily defined. But any directors have struggled to explain what the “S” really means and how social issues can be measured. But these issues have now been pushed to the forefront in ...
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Risk Management After COVID-19Issue: 2020 Annual ReportWhile many boards were not prepared for all that happened this Spring, others have been working on robust business continuity plans for years. They may not have accounted for the confluence of crises that would affect society and the economy at once, but they were prepared for disruption by beefing ...
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Top of MindIssue: 2020 Annual ReportI spent 18 years as a CIO in manufacturing and then became a CIO in the banking industry. But very seldom have CIOs risen to the chair and CEO position. I think that’s because they tend to focus on technology instead of business. I’ve always taken the business approach first. Everything starts with ...
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Four Principles of Risk ManagementIssue: 2020 Annual ReportStrong enterprise risk management is an imperative in the 21st century in a flattening world with growing complexity, the global movement of people and arguably more frequent disruptions and disasters. Organizations must match the evolution of strategies and operating models to mitigate potentially ...
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Revisiting IndependenceIssue: 2020 Annual ReportOne of the pillars of corporate law is the directors’ fiduciary duty of loyalty to the corporation and its shareholders. In general, the duty of loyalty requires that a director, in making decisions, act on a disinterested and independent basis, in good faith, with an honest belief that the action i...
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Compensation Matters: At Your DiscretionIssue: 2020 Annual ReportThe coronavirus pandemic gave the global economy an unprecedented shock that has raised the stakes for one of the compensation committee’s most challenging tasks — determining when and how to apply discretion to adjust executives’ incentive pay for circumstances outside their control.The question of...
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Editor's Note: Trading in Textbooks for NewspapersIssue: 2020 Annual ReportI think that a few words of introduction and guidance are in order. I have been a regular contributor and, more importantly, a reader and devotee of Directors & Boards for the past 25 years. I firmly believe that this publication has been, is now, and will continue to be the thought leader in co...
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Publisher's Letter: Jobs Offer HopeIssue: 2020 Annual Report“Joblessness leads to hopelessness, [and] hopelessness leads to what we see in the streets,” observed Merck’s CEO Ken Frazier, who emphasized the role of Black unemployment in exacerbating the social unrest sparked by the police killing of George Floyd. Maintaining that business has the means to eli...
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2020 Private Boards of the Year Award Winners AnnouncedSix private company boards will be honored for their business governance excellence at the upcoming 2020 Private Company Governance Summit on September 15-17, 2020, live online.The boards of these companies were selected for recognition:David S. Lapine Company, Inc.The Hussey Seating CompanyDraper a...