The Future of the American Board Report: A Framework for Governing into the Future

In brief: The requirements of good governance are always changing, but the last few years have shown how the ground can shift suddenly.  In a world that seems increasingly less governable, corporate governance has also become more challenging. 

Heightened demands and expectations about the role of the corporation in society signal the need for greater diligence and commitment on the part of corporate directors. This report takes a deeper look at the powers, responsibilities and genuine agency of the board and outlines 10 principles to build toward higher board performance in the coming years.

The Future of the American Board Initiative presents these principles as a "Framework for Governing Into the Future" that boards can use to spur discussion about whether their own workings and composition are fit-for-the-future. The framework explores how boards should consider the importance of corporate purpose, assess the interests of all critical stakeholders, strengthen the oversight of talent and culture, and improve the agility of board operations.

Drawing on the insights and collective experience of a diverse, influential Commission of directors and notable governance practitioners, and building off the foundational guidance issued by NACD in the original "Key Agreed Principles," the Framework is intended for both public and private company boards as well as investors and advisors.

The report can help boards to:

• Discuss key matters and questions affecting board performance and identify opportunities for improvement. The framework can be used to update your board evaluation process.

• Tailor their governance and structures and practices to meet the future needs of their business

• Consider changes to their corporate governance guidelines and committee charters

• Work with management to clarify expectations about the role of the board

• Start discussions about your company’s long-term strategy and the growing importance of meeting different stakeholder expectations in the pursuit of that strategy

Most Relevant Audiences: directors of public and private organizations, committee chairs , lead directors, board chairs, CEOs

The focus on the board’s compensation committee has never been sharper. The components of compensation plans and the link between compensation and company performance are under intense scrutiny from shareholders, employees, policymakers, the media, and other stakeholders. The Report of the NACD Blue Ribbon Commission on the Compensation Committee revisits NACD’s 2003 Report of the NACD Blue Ribbon Commission on Executive Compensation to highlight the new environment in which compensation committees—and, more broadly, boards—are now operating. It recommends that the compensation committee and board work together to establish an executive compensation philosophy that supports the company in creating long-term, sustainable value.

The report includes ten specific recommendations for compensation committees to consider when evaluating their compensation philosophies. It also provides practical tools, such as sample compensation committee charters, a compensation committee assessment, and guidance on executive employment contracts.