Corporate Boards Get More Serious About Job Performance
Bloomberg's Big Law Business article, “Corporate Boards Get More Serious About Job Performance,” quoted Russell Reynolds Associates Consultant Constantine Alexandrakis about boards becoming more systematic about performance. The article is excerpted below.
How well corporate board members do their jobs is being measured more rigorously amid increased scrutiny from investors and each other.
Most of the Russell 3000 company boards that say they review their performance each year now look at members individually, rather than as a whole, according to data provided by Institutional Shareholder Services Inc. Companies are also increasingly looking to outsiders for a more objective board evaluation, instead of doing it themselves.
Board performance was looked at “very loosely” in the past, said Constantine Alexandrakis, a member of the board and CEO advisory group at executive search firm Russell Reynolds Associates. The firm conducts external board assessments, which typically ask questions about directors’ contributions, the board’s culture, and other areas.
“It’s gotten much more systematic,” he said, as investors scrutinize who sits on the board and what they bring to the table. Board members are also becoming more critical of each other as their workload grows and some worry their peers can’t keep up, according to a survey by consultant PwC.
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