"AFTER WORKING FOR Goodbody & Co. (later acquired by Merrill Lynch) in New York from 1965 to 1970, I came back to Washington and started my own investment banking consulting and publishing firm. I published a lot of brochures for the individual investor on such topics as taxes, the role of fixed income, U.S. government securities, and municipal bonds. All the investment banking firms would buy these from me and put their imprint on them to give to their customers. I was also putting small bond deals together -- I would package it and take it to an investment banking firm and if they had an interest they would buy it.
The municipal bond industry was in a kind of crisis at the time because there were a lot of abuses with industrial revenue bonds. The SEC was investigating what we used to call the Tennessee Bandits, but it really didn't understand the municipal securities business so I became a consultant to the SEC. That's when I first met Harold Williams. He spoke at a number of seminars and conferences that I put on. I got to know him pretty well. He was one of the true believers in corporate governance. He wanted a board of all independent outside directors with the exception of the chief executive officer, and he was one of the great leaders of the movement for having a nonexecutive chairman.
What else was happening during the '70s was you had the Penn Central disaster, you had Ralph Nader beating up on companies, you had the furor over illegal foreign payments, you had vast insider trading going on, you had accounting scandals at companies like Lums and Mattel. This whole period of time was one of "Where was the board?" I'm not sure why I did it but I wrote a little book on the duties and responsibilities of boards of directors. That is what led to the formation of the NACD. It was as simple as that.
But there wasn't anything simple about getting the NACD established. The early years were very difficult. Corporate America wasn't enamored of Harold Williams, and I'll tell you that Corporate America wasn't enamored of John Nash, either. We ran into a lot of opposition. Everybody thought that we were on the side of the Street, rather than representing boards and trying to help boards do a better job in their role as directors and to help them better understand their fiduciary responsibilities. The Business Roundtable wasn't having anything to do with this at that time. So in the beginning nobody paid attention to us.
The NACD came under the...