Board indifference: they're directors in great demand - 28 Tar Heels who sit on four or more boards. But are they stretched too thin to count?

• Author: Brown, Kathryn

Nelson Schwab doesn't like to reschedule meetings, so he plans his calendar a year at a time. "I carry a little chart around with me," he says. "It tells me when I can schedule things and when I can't."

These days, his little chart looks quite jumbled as he shuttles among board meetings of nine companies. Juggling those directorships and his responsibilities as managing director of Carousel Capital, the Charlotte-based merchant bank, is enough to make him dizzy. Schwab estimates he spends 40 days a year in board meetings not to mention committee meetings and teleconferences - for companies ranging from amusement-park operator Silver Dollar City Inc. in Branson, Mo., to energy-management company Ilium Elex Corp. in Raleigh. Some of that is part of his job; four of the boards are companies Carousel invests in.

"Right now, I'm woefully behind," he says in late April. "I've got 40 phone calls to make." He glances at his one-page chart, meticulously plotted at the start of each year and crammed with scribblings of added appointments. There won't be any relief anytime soon. Next week, he has three board meetings in three days.

Schwab is part of an elite group of Tar Heel executives who sit on multiple company boards. Nobody serves on more than he does - a dubious distinction, he calls it. But 28 North Carolinians serve on four or more boards. Sixteen are on five or more.

With so much to do, how do they find the time? That's what many large pension funds, which manage hundreds of millions of dollars in stocks for members, want to know. Along with governance groups that monitor boards, they've put directors under increased scrutiny, questioning their effectiveness when they have fingers in so many pies.

In the last two years, three Washington, D.C.-based groups - the National Association of Corporate Directors, the Council of Institutional Investors and the Teamsters have recommended limits on directors' commitments. The Teamsters' guideline is the loosest: no more than three boards for a standing CEO. CII recommends a maximum of two. NACD says CEOs should commit to no more than one - in addition to their own - and retired executives no more than five.

Such standards would leave dozens of Tar Heels in the hot seat. Of the 28 on four or more boards, 17 have full-time jobs, 10 as CEOs.

Critics wonder how directors spread so thin can add much value. "It's the tyranny of time and the tyranny of the mind," says John Nash, director of the Washington, D.C.-based Center for Board Leadership, a spinoff of the nonprofit NACD. "How much can one person absorb?" Brad Pacheco, spokesman for the California Public Employees' Retirement System, which manages $1.35 billion in pension assets, says, "No director can be effective without spending personal time and energy on a board. You can't do that by sitting on multiple boards."

And what about a CEO's responsibilities to his own company? Last year, boards of Standard & Poors 500 companies met, on average, seven times. Using that as a gauge, a CEO with just three board commitments outside his own company's - such as First Union Corp.'s Ed Crutchfield, Nucor Corp.'s John Correnti and Duke Energy Corp.'s Richard Priory - is away from the office 21 days a year. That's equal to about four weeks of vacation. "They're being paid to run a company, not sit on boards," Nash says.

The backlash began in 1996, when the Teamsters compiled a list of what it considered the nation's...