NACD - National Association of Corporate Directors
Directorship Magazine January/February 2014 Issue

Table of Contents

January/February 2014

COVER STORY

A Look Ahead

FEATURES

2014 OUTLOOK

Through the Audit Committee’s Lens

Priorities for 2014 sharpen focus on key governance challenges.
by Dennis T. Whalen

2014 OUTLOOK

The Unsociable Boardroom: A Costly Strategy for 2014

Directors need to understand how strategies are being applied or affected by the social world.
by Fay Feeney

2014 OUTLOOK

Customizing Incentive Goals and Payouts to Specific Business Needs

Imperatives for building and maintaining great management teams that will drive long-term success.
by David N. Swinford

2014 OUTLOOK

What’s Up for Entrepreneurial Governance

Focus areas for micro- and small-cap-focused activist funds in 2014.
by Adam J. Epstein

2014 OUTLOOK

Striking the Right Balance for the Future of U.S. Capital Markets

U.S. capital markets provide companies with deep, well-regulated sources of financing and offer investors myriad ways to participate in economic growth.
by Cynthia M. Fornelli

2014 OUTLOOK

The Activist Investor: Taking a Page From the 'Opposition Research' Playbook

Be sure your directors know what the investors know about your fellow board members.
by Ernest Brod

2014 Outlook

A Proxy Season Carol

Haunted by visions of proxy season past, present, and future, the observations on 2014 apply the lessons learned by these ghostly visitations.
by Patrick McGurn

DEPARTMENTS

President's Letter

On Planning

In this issue, we look forward to defining what the major issues in governance are likely to be in the coming year.
by Kenneth Daly

Editor’s Note

Better All the Time

A sweeping look at the people and events most likely to shape board agendas in 2014.
by Judy Warner

Chair’s Address

Primed for a Future of Exemplary Board Leadership

Triple aims for board governance: board effectiveness, sustainable corporate success, and public trust.
by Reatha Clark King

The Director’s Chair

A Board’s Eye View of Risk Management

Enterprise risk management (ERM) has become an effective lens through which board members can guide and monitor a company’s growth.
by Kay Thompson

Keeping Count

Directors Focus on People, Risk, and External Communications

Highlights from the annual public company governance survey show an increase in time commitment.
by Kate Iannelli

Washington Update

On Fire Again: Proxy Voting

Whatever happened to proxy access?
by Alexandra R. Lajoux

NACD Board Leadership Fellow

Jane E. Henney MD

Oncologist. Public Servant. Academic. Board Director.
by NACD Editors

Entrepreneurial Governance

Why Small-Caps Undertake Bad Financings: Board Composition

Comparatively diminutive governance budgets force many micro- and small-cap companies into board compositions focused on surviving, as opposed to thriving.
by Adam J. Epstein

Readings

Fateful Decisions

In "True South," Johnston’s reportorial work included the perusal of hundreds of diary entries penned by Sir Robert Falcon Scott and Roald Amundsen in their race to explore the South Pole. The contrast is a case study in what makes an organization thrive. As anyone who has followed arctic exploration knows, Amundsen prevailed; Scott and his entire crew died. Why? Johnston doesn’t hem and haw.
by Jeffrey M. Cunningham

Why Tone at the Bottom Should Replace Tone at the Top

Drawing from his deep and extensive reservoir of unique firsthand experience in business and consulting work around the globe, Dr. Larry Taylor illustrates in his book vivid real-life examples of the challenges independent corporate directors are facing and the boundless opportunities they have in contributing through their corporations to reaffirm the virtues of the free enterprise system.
by Paul W. Chan

Encouraging Leadership in the Boardroom

A new book by three veteran corporate governance leaders, Boards That Lead: When to Take Charge, When to Partner, and When to Stay Out of the Way, asserts that as increased regulation, shareholder pressures, and governance reform have strengthened directors’ oversight abilities, these same forces have also strengthened their leadership skills.
by Cheryl Soltis Martel

Private Company Insights

Evolve Corporate Governance to Keep Pace with the Demands of Growth

In developing and maintaining an effective governance structure, private companies should bring the right people and perspectives to the table periodically to assess the governance structure, and to ensure that present and future governance structures meet the expectations of key stakeholders and serve as a foundation to achieve the company’s strategic objectives.
by James P. Liddy

Boardroom Journal

Too Big to Comprehend

Commentary on the Volcker Rule, GM, diversity, and European boardwork.
by Jeffrey M. Cunningham

DIRECTOR ADVISORY

BOARD COMPOSITION

Director Independence: A Focus on Board Tenure

Implementing a policy on director tenure could have major ramifications because of the significant influence proxy advisory firms now have in corporate elections.
by Bob Romanchek and Jeff Keckley

COMPLIANCE STRATEGY

Conflict Minerals: Scaling Your Program for 2015

A holistic compliance strategy that will scale from this year to 2015 and beyond will free up resources and capital that can  be used to improve corporate performance, product portfolio, and market position.
by Howard Heppelmann

COMPLIANCE AND RISK

The SEC’s New Enforcement Mandate

What will this approach mean to corporate directors striving to improve registrant compliance and minimize risk?
by Martin Wilczynski

BOARD AGENDA

Is Your Board Focused on Cyber Preparedness?

Don’t count on luck but rather on a plan that anticipates a breach.
by Nels Olson Aileen Alexander and Jamey Cummings

SHAREHOLDERS

When Is a Good Time for the Board to Communicate Directly with Shareholders?

A director should generally not meet alone with a shareholder.
by Mary Ann Cloyd

INTERNAL AUDIT

An Untapped Source of Board Talent

Internal auditing’s professional code of ethics…requires practitioners to uphold and apply to their work the principles of integrity, objectivity, and confidentiality. Are these not also critical attributes of directors?
by Richard Chambers