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Some Thoughts for Boards of Directors in 2008

By Harvard Law School Program on Corporate Governance

Marty Lipton’s Some Thoughts for Boards of Directors in 2008 is a wide-ranging view of the challenges facing boards of directors in the post-Enron world. The principal focus is on the implications of the attack on the director-centric model and the pressures for short-term performance. The Memo’s first page states rather bluntly what is at stake:

“The need to critically evaluate these trends, rather than passively adhering to the shareholder rights and other activist mantras of the post-Enron period, has become grave. The demonstrated genius of the large public corporation has been its ability to harness equity, debt and human resources to invest in large projects with long-term investment horizons, and the success of such ventures has been integral to the remarkable flourishing of the U.S. economy over time. To the extent that boards are increasingly vulnerable to demands for short-term gains, these trends promise to have repercussions not just for the role of the corporate board but for American business more generally.”

The full Memorandum is available here.

Full post as published by The Harvard Law School Corporate Governance Blog on December 10, 2007 (boomark / email).