Tell me again: what do you want to do? What a counselor to senior executives advises a client who is considering joining a board.

• Author: Wynne, William F., Jr.
• Position: DIRECTOR RECRUITING

HOW DO I RESPOND when a client asks about corporate board membership? In years past, joining a board was a high honor. Lately, the seemingly endless headlines trumpeting governmental investigations into corporate malfeasance have lent an ominous cast to the prospect of what once was a coveted badge of business achievement.

"I've been asked to sit on the board of XYZ Corporation," a CEO may tell me. "But between the tightened rules under Sarbanes-Oxley and these ongoing investigations, I worry now about how much trouble I may be setting myself up for."

Just as with any other significant business decision, caution and prudence should govern the analysis of whether to join a board. Before launching into a detailed discussion of Sarbanes-Oxley rules and examining potential liabilities, I advise any client who is considering joining a board to step back and consider carefully the following questions:

1. Why do you want to serve on the board?

   There are excellent reasons for serving on a board. But, if you are considering joining a board because a friend or customer asked you to as a "favor," or because you think it will bring you prestige or advance your or your spouse's social standing, you have failed to identify these reasons.

   The old "social" rationale for board service simply doesn't pass muster. In fact, one of the deficiencies that SOX sought to address arose from this form of cronyism. It too often produced board members who simply rubber-stamped proposed executive compensation, budgets, and management plans. Therefore, if you are approached by a friend, customer, or client to serve, you should think hard before accepting. Even if a current or past relationship does not constitute a conflict of interest under the new SEC and stock exchange definitions of independence, it may create the appearance of a conflict later when board action is under the microscope.

   If, as is happening more frequently, you are approached by a search firm that has been hired to identify board candidates, you should weigh the opportunity differently. Ask the headhunter how and why you were identified. How does your background fit with the company's strategy or business model? What skills do you have that are attractive to the company? What skills do you need to serve competently? What would your responsibilities be? For example, if the board seeks someone to serve on its audit committee, do you have the necessary financial background and experience to serve? What in your professional or personal life has prepared you to do this job? What is the time commitment? Will you have to travel extensively?

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