Ed. Note: Board process has been an evergreen target of Directors & Boards authors over the years. One of our classic articles focusing on how boards operate is "The Power and the Process" by Paul Stern [Spring 1993]. Following is an excerpt. At the time he wrote this article, Dr. Stern was serving as non-executive chairman of Northern Telecom Ltd., following a career that included senior positions with Unisys Corp., Burroughs Corp., Rockwell International, Braun AG, and IBM. His board service included Dow Chemical Co., LTV Corp., and Whirlpool Corp.
In a rapidly evolving international economy, those institutions that are not changing their ways of doing things and, most important, their thinking, are clearly headed for extinction. The Roman orator Cicero once said of a friend: "He remained the same when the same was no longer fitting."
The question for today is this: Will corporate governance remain the same when the same is no longer fitting? Will companies and their boards recognize that the management processes and governance practices of the global corporation must be dramatically different? Will they simply try to fine-tune or will they see the need to break loose from policies, attitudes, and governance practices that are no longer fitting?
For years, many boards...