Red Flags and Green Lights: Important Considerations When Joining Your First Board – Or Your Tenth (Part 1)

Board service is rewarding, but not risk-free. Directors must be adept at overseeing corporate financials, talent strategies, and risk exposure, and must also give consideration to how board service affects their own personal financial and risk profile. This program will equip attendees with the practical questions to ask when joining a board or evaluating whether to continue serving on a board. 

Session 1 will take place on April 14 and will include a presentation on how to evaluate a company’s financial health and risk profile, as well as a presentation on equity compensation for directors. Session 2 will take place on May 6 and will include a presentation on D&O insurance, as well as a presentation on the director’s guide to governance documents. Each of the four presentations will be limited to 35-45 minutes, but there will be ample opportunity afterwards for Q&A, networking, and follow-up conversations with the expert speakers.

What Am I Walking Into?  A Director's Due Diligence Framework for Evaluating Board Opportunities (35 Minutes)

Speakers: Chad J. Rubin, Esq. and Rebecca A. Guzman, Esq., Duane Morris LLP

Not all directorships are created equal and not all of them are worth the risk. Before you climb onboard, how do you assess whether a company is a good fit for your risk tolerance, time, and fiduciary responsibilities? Board service is often presented as a uniformly prestigious opportunity, but the reality is that the risks, demands, and rewards vary enormously from company to company. This session will equip prospective directors with a practical, repeatable framework for evaluating the financial health, governance dynamics, and risk profile of a company before accepting a seat.

Key Topics:

• Understanding the Power Map: Capitalization, Control, and Investor Rights
• Financial Health and Forecasting
• Litigation, Regulatory, and Compliance Exposure
• Protecting Yourself: D&O Insurance and Indemnification
• Compensation and Time Commitment: Is It Worth It?
• Board Culture and Risk Appetite
• Red Flags That Should Give Pause

Equity Compensation for Directors (45 minutes)

Speakers: Amara M. Briggs and Elizabeth Sohmer, Berstein Private Wealth Management

Many directors are compensated with some form of equity in the company they are overseeing. How should directors understand the financial upside and downside of equity compensation, and what are the personal tax and liquidity risks? This session will help directors evaluate their equity compensation packages to remain aligned with company performance while minimizing overexposure and concentration risk.

Key Topics:

• Common equity structures for directors (stock grants, RSUs, stock options, carried interest for PE and VC-backed boards)
• Vesting schedules and acceleration provisions
• Liquidity realities: private company stock and lockups
• Tax considerations (ordinary income vs. capital gains, AMT risk)
• Impact of concentration risk within an overall asset allocation for executives, especially during a transition to a new role (Case Study)

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