Tim Rowley, "Measuring the Effectiveness of Boards: Shining Light on Unlit Areas of Corporate Endeavour", Rotman Lifelong Learning 2005, June 3, 2005

Lifelong Learning 2005, Rotman School of Management, (University of Toronto), held at the Fairmont Royal York Hotel, June 3, 2005, 9:20 a.m.

Tim Rowley, Deloitte & Touche Professor of Strategic Management and Director, Clarkson Centre for Business Ethics and Board Effectiveness, Rotman School

These participant's notes were created in real-time during the meeting, based on the speaker's presentation(s) and comments from the audience. These should not be viewed as official transcripts of the meeting, but only as an interpretation by a single individual. Lapses, grammatical errors, and typing mistakes may not have been corrected. Questions about content should be directed to the originator. These notes have been contributed by David Ing (daviding@systemicbusiness.org) of the Systemic Business Community ( http://systemicbusiness.org ).

Introduction by Andrew Gowers

[Tim Rowley]

Discussing governance

What do directors do?

More like anti-inflammatories, than steroids

David Beatty's calendar

Survey on boards: want to spend less time on oversight, and more time on talent management

Jay Lorsch: The duties of directors, can't do in the time allotted.

Boardroom: the grand canyon

e.g. Hollinger case:

A lot of governance problems today aren't different from history

To 1720 England, South Seas Company, doing the same thing

A lot in the press on huge value restructuring: Enron, Worldcom, Nortel

This comes back onto directors

Richard Breedon wrote the report for Worldcom, as well as Hollingers

Martha Stewart, did what every MBA student was trained to do

Disney: compensation committe head is Michael Eisner's personal lawyer

Cartoon: T'he only thin that can save us is an accounting breakthrough

Healthsouth: 11 executive pleaded guilty to criminal charges


Where were the directors?

Standards changing, focused on accounting standard, changing the compliance side of governance

Regulation changes, but what about the directors?

A lot of bodies outside boardrooms are putting pressure on change.

What are the factors that lead to governance reform?

Thesis: They're bad for governance

Relationship networks are effective in diffusion, in innovation and disease

Average score of TSX index firms, with the Elite 16

Comparison on different criteria in comparing Elite to others

Went to directors, and asked: how come?


Andrew Gowers: Counter to expectation. How about 10 years ago?

Question: Of the Elite 16, only one has a full-time executive job elsewhere. Changing notion of professional directors?

Enron and Worldcom claims, out of own pocket. Volunteer chill for directors?

Directors, management skill and education over the past 40 years? Higher level of professionalism

Directors spending more time on talent. SOX North. Demarais has said boards are spending too much time on process, and not on strategy.

Domenic D'Allesandro and Frank Stronach: feedback from them?

Causal relationship between the Elite 16, and how they're better players on corporate governance. Could it be they're better, because they're large companies?

Increase in liability risk. What's happened to compensation?

Where to find directors in the future?

End of content


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