Following on from the Denning piece in Forbes on corporate governance, I had a look at the HBR article he references entitled "Where Boards Fall Short" by Dominic Barton of McKinsey & Co. and Mark Wiseman, CEO of CPPIB in Toronto.
This is an interesting and provoking piece of corporate governance literature that neatly lays out the problem (board directors don't understand company strategy as much as they should), why it happens (poor recruitment combined with lack of focus on long term strategy) and presents some solutions to the reader (incuding improving director recruitment and effective investor engagement and dialogue on strategic issues, amoungst others). It a nutshell, this is not "noses in" but "mind, body and soul in" for corporate directors.
It is however controversial, and proposes more pay for engaged directors and material equity ownership for directors in both ordinary shares and incentive arrangements linked to longer term performance. Do check out this paper - while it does acknowledge the role of the board director in achieving long term performance, it does so by raising the bar for directors of both public and private equity owned firms.
Reference
Barton, Dominic and Wiseman, Mark. (2015) Where Boards Fall Short. The Harvard Business Review. January - February 2015. Pages 98 to 104.
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