Back to the  Drawing Board

Designing  Corporate Boards for a Complex World

by Colin B.  Carter and Jay W. Lorsch

Carter and Lorsch have  noted that "around the world, scandals and company failures have provoked a  storm of criticism and well-meaning reforms. In response, a variety of 'best  practices' have emerged, but can such ad hoc adjustments fundamentally change  the capacity of boards to provide good governance?"

I attended a Forum for  Corporate Director's meeting featuring Professor Lorsch from Harvard Business  School - it was an outstanding morning filled with additional insights,  confirmations, and new ideas concerning corporate governance. This excellent  book extended that rewarding experience and will likely be a constant reference  in my corporate governance work. Carter and Lorsch have extensive research  (included in appendices) behind their suggestions for change in corporate  boards. In a refreshingly clear writing style, they expose the gap between  theoretical board design and the practical results of board design. Further,  they acknowledge that these gaps cannot be closed completely, nor can they be  legislated out of existence. Instead, as always, we must rely on the women and  men who sit on boards to have a deep understanding of their mission, the boards  mission, a commitment to integrity, and knowledge of the workings of their  executive suite.

Back to the Drawing  Board is laid out in a logical manner, and approaches this complex issue of  properly designing boards in an equally logical manner. The face, head on, the  issue of increased time and energy that will be required of new board members.  The clearly address the issue of independent directors and squarely address the  advantages and disadvantages of independent directors versus executive  directors. They also address the concerns of the executive director who, in many  respects is required to sit in judgment of her boss. Perhaps most refreshing is  the concern that we not throw the baby out with the bath water, that we not  think that Sarbanes-Oxley is the complete answer, and that we not expect a "one  size fits all" board structure. Rather, we must do the hard work of defining a  particular board's role, redesign accordingly, and rethink the processes,  practices and policies of our decision makers.

This book is a must read  for anyone involved in corporate governance whether they are on a board, aspire  to be on a board, consult to those responsible for corporate governance or are a  member of the "c" suite. Thank you Mr. Carter (of the Boston Consulting Group)  and Professor Lorsch (Harvard Business School) for this excellent work.

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