Strengthening corporate governance through board‐level consultants

Abstract

Abstract Corporate governance represents a primary leverage point for improving organizational performance. CEOs generally control the information received by the board of directors, and so the board′s functioning may suffer from an information deficit. Offers a potential solution to such dependency through the use of consultants who report directly to the board, thus serving as independent sources of guidance and information. Suggests outside consultants could help board members to meet their fiduciary responsibilities to shareholders by improving corporate governance. They could also define the roles of board members; evaluate CEO performance and rewards; monitor the development of others in senior management; and objectively identify and evaluate key issues which call for a board response. Proposes that using consultants to span the boundaries between the board and the organization offers a key point of leverage in improving corporate performance.