Companies Do Better When Corporate Board Members Aren’t Overcommitted

Board members serve to vet management’s business strategy and protect shareholders’ interests. But in recent years the board’s responsibilities have expanded to include overseeing the audit of a public company’s financial reporting and making decisions concerning executive compensation, among other matters. Directors who sit on multiple boards often struggle to divide their time between commitments and the need to develop new skills in response to new business challenges, the report said. Over-committed board members can also run into conflicts of interest. “This adds further weight to our view that “overboarding” is a negative for both corporate performance and investor returns,” the report said.

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