Lessons from America
Board complacency is no longer an option in today's world, and there is an argument that the best way to address this is a return to the legal basics. In the first of two articles on the state of corporate governance, Bob Garratt asks, are we in danger of losing our perspective?
I spend most of my time inducting, developing and appraising boards. As a non-lawyer I am conscious that the big difference between being an executive and being a director is that the directoral role is much more tightly bound by law. So I ensure that new and existing directors have their legal board and personal accountabilities, roles and tasks spelled out to them and, whenever possible, codified into a board manual or board induction handbook. Yet, when working with legal counsel for a board I often feel that I am living in a parallel universe because the legal advice offered seems increasingly, and occasionally dangerously, out of step with the growing legislation and regulation. What is going on?
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