Report of the NACD Blue Ribbon Commission on the Effective Lead Director

The importance of the lead director role is evident from its name—a director who leads fellow board members who, in turn, comprise the corporation’s highest decision-making authority. Just as a chief executive leads a corporation, the lead director leads the work of the independent directors. This report examines the lead director role to increase the efficiency and effectiveness of the person in the position.

This report covers the following topics:

• The current expectations of a lead director: What fundamental duties does the lead director perform?

• Selecting, evaluating, and compensating the lead director: What particular attributes should a lead director possess? How should the lead director be elected and assessed? Is a term certain desirable?  

• Key relationships and communication: How should the role of the lead director relate to the Chairman/CEO, fellow directors, and various committees, including the nominating and governance committee? Does the lead director have a particular role in advising the Chairman/CEO? What about communications with shareholders and other stakeholders?

• Enhancing the role: In the future, what new duties might be appropriate—and under what circumstances might they apply? How can the lead director be most effective?