NACD - National Association of Corporate Directors
Directorship Magazine March/April 2014 Issue

Table of Contents

March/April 2014

COVER STORY

The Activist Era

FEATURES

2014 KPMG Audit Committee Issues Conference

Growth, Governance, and Guiding Business Forward

By most key measures, 2014 will be a pivotal year for many boards and audit committees, as well, as they wrestle with agendas increasingly dominated by “must dos”—legal and regulatory compliance matters and governance mandates—and a business and risk environment that’s moving faster and is less forgiving than ever.
by NACD Editors

2013-2014 Director Compensation Report

Historic Norms Return to Board Pay

The 2013–2014 NACD Director Compensation Report, produced in collaboration with Pearl Meyer & Partners using survey data provided in part by Equilar, affirms that despite an initial spike in pay as the economy emerged from recession, increases in median director pay have since moderated. All the details are here for companies of all sizes and sectors.
by Jesse Rhodes

Leading Minds of Governance

Expert Panelists Provide Informed Answers to Directors’ Most Pressing Questions

From the advancement of women and dual-loyalty directors to social media in the boardroom, here’s what an audience of directors gleaned from such leading minds as former Chief Justice Myron T. Strine, The Deal Professor, and the auditor.
by NACD Editors

DEPARTMENTS

President's Letter

A Closer Look at Corporate Democracy

The president and CEO of NACD has a new message for NACD members and readers.
by Kenneth Daly

Editor’s Note

Keeping Calm

If you like the illustration on the cover of this issue of NACD Directorship, thank Ken Daly, the president and CEO of NACD, writes the editor-in-chief in this issue's note to our reader members.
by Judy Warner

The Director’s Chair

The Competitive Edge of Soft Metrics

Why employee engagement is the new measure of performance.
by Janet Jankura

Keeping Count

The Power of Information

Formal planning is the key factor in determining comfort in information sharing.
by Kate Iannelli

Washington

Gates and the Barbarians

Former Secretary of Defense Robert M. Gates provides boardroom officers and directors the most penetrating and impassioned political memoir in decades—especially if you prefer reading Tom Clancy crossed with Franz Kafka.
by Jeffrey M. Cunningham

Delaware Watch

Court Action to Affect Boards in At Least Five Ways

Five areas of emerging importance from the hot spot for private ordering—especially for smaller private corporations—the Chancery and Supreme Courts in Delaware.
by Alexandra R. Lajoux

NACD Board Leadership Fellow

Martin M. Coyne II

Board Director. Chapter Leader. Continuous Learner.
by NACD Editors

Verbatim

The Corporation and Its Discontents

Jonathan R. Macey’s keen sense of humor belies his true calling as a shrewd arbiter of corporate and securities law, regulation, and governance.
by Jeffrey M. Cunningham

In Practice

10 Surprises That May Be Lurking In Your D&O Policy

Even directors and officers at America’s biggest public and private companies can receive a rude surprise when they discover that a claim they assumed was covered by their directors and officers (D&O) liability insurance isn’t.
by G. Andrew Lundberg

Peer Exchange

Flow From the C-Suite and Beyond

Ensuring your board has the information it needs.
by Cheryl Soltis Martel

Entrepreneurial Governance

Conversation with Keith E. Gottfried, Proxy Contest Defense Counsel

Over the course of a legal career that spans more than two decades, Gottfried has been involved in defending numerous companies against proxy contests and other activist shareholder campaigns
by Adam J. Epstein

Readings

CEO Divorce and the Board

A study on the impact of CEO divorce on shareholders by Stanford’s David L. Larcker suggests that boards have “a responsibility to have a grasp on the married lives of their CEOs.”
by Jeffrey M. Cunningham

Private Company Insights

Keeping Growth and Governance in Sync

Given the renewed interest in initial public offerings (IPOs) and a revival of merger and acquisition and buyout activity, private company directors and officers can benefit from assessing their company’s governance.
by James P. Liddy

Boardroom Journal

The Party Line

In spring 1987, President Ronald Reagan’s speechwriter, Peter Robinson, broke free from his entourage to join a suburban dinner party near Berlin. (You can read the full story in The New Criterion, January 2014.) His host said Robinson should hear real Berliners talking about the cold war.
by Jeffrey M. Cunningham

DIRECTOR ADVISORY

Compensation

Deferred Compensation Plans for Directors Grow in Appeal

With director pay philosophy being reexamined to reflect today’s realities as well as increased expectations from institutional shareholders, compensation committees are taking an active role in redesigning appropriate board pay arrangements.
by Jason Maples and Rocky Grimes

Risk Oversight

Facing Cyber Threats: Keys to Security, Vigilance, And Resilience

With virtually all large public companies facing myriad cyber threats, how can board members best conduct that oversight?
by Mary E. Galligan

Board Composition

Dare to Be Different: A Strong Business Needs Diversity in the Boardroom

To improve diversity, boards should plan for their own succession as rigorously as they plan for the CEO’s.
by Mary Ann Cloyd

M&A Litigation

Determining Fair Value: Delaware Court Embraces Sale Price as Outcome Determinative

Appraisals in connection with the sale of public companies is focus of Delaware Court of Chancery in Huff Fund Investment Partnership v. CKx, Inc.
by David N. Shine

Audit Committee Roundup

Workload, CFO Succession, Risk Oversight Key Challenges for Audit Committees

Audit committees around the world say it is becoming increasingly difficult to oversee major risks in addition to financial reporting.
by Dennis T. Whalen