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| Best Practices |
Constructive Contention
Suzanne McGee
06/01/2004
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When it comes to open and
spontaneous debate, however, all too often a CEO might be the one who stifles
all constructive dissent. While imperial CEOs who will tolerate no challenges
are the exception to the rule, governance experts agree, their infamy is well
recorded. Bernie Ebbers, former WorldCom CEO, was known to have little tolerance
for anyone who questioned his professional judgment. And Hollinger’s Conrad
Black, according to suits filed against the company’s directors, brought
decisions to his board to ratify long after he had already acted on them. A CEO
can acquire an undue amount of power simply by virtue of his or her long tenure,
as has Michael Eisner at Disney. Nonetheless, in all these cases, governance
gurus insist that board members could have asserted themselves. “The CEO serves
at the pleasure of the board,” says Roger Raber, president of the National
Association of Corporate Directors in Washington. D.C.
“Directors are aware, at
least in theory, that keeping their mouths
shut...is risky, to them personally as well as to the company.” |
Those of us who have
found no outlet for voicing dissent at a board meeting should not chastise
ourselves for timidity, however; few boards have any kind of formal procedure to
solicit or encourage dissent, leaving it up to the chairperson or lead director
to set the direction for discussions. “There is clearly a problem of group
dynamics here, one that has immense consequences for the way corporate boards
function,” says Lorsch. “In any board discussion or group meeting I have
attended, there are always people who may be antsy about where the discussion is
going but who don’t have the courage to stand and contradict people who have
more seniority on the board or a CEO who seems to have all the information.” Few
would risk the social and professional ostracism that traditionally plague the
lone dissenter.
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