Do you think boards today are running better or worse than before?
Actually, too many of them are running scared. And while that may give some governance groups a self-satisfied twinge of victory, a board in defensive mode is bad for employees, companies, and the economy.
So what’s going on? We’ve been speaking recently with groups of CEOs—a total of about 300—in several small, in-depth sessions. They have come from a variety of companies, but one thing they all share, to varying degrees, is a pressing concern about the changed nature of their boards, a direct result of the governance scandals and the reforms that followed. As one CEO put it: “Every meeting starts in one form or another with the question, ‘Has anything happened since we last met that’s going to show up in the papers and embarrass us?’ Then we hunker down over financial reports and risk assessments to give everyone a sense of comfort.”
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