Real pressure.

• Author: Clark, W.H.
• Position: Pressures facing corporate directors

From CEO succession problems to being locked out of his hotel room, veteran board member W.H. Clark reflects on the pressures facing directors.

How does a board act under pressure? I have been involved with about 10 boards over the years. They react differently. Some respond extremely well. Others really stumble and have a tough time with pressure - depending upon what type of pressure it is.

Having been in the chemical business for 34 years, I've had a lot of opportunities to respond to environmental pressures. Other pressures include fraud, especially if you're doing business in many parts of the world as the companies with which I've been involved are doing. There is potential for pressure on the board as a result of sexual harassment, which can happen in the corporations with which we're associated. Minority or diversity problems are always something that must be considered. Union problems are always opportunities to exert pressure on boards. Unions are getting, I think, bolder and bolder as time goes on. A management which is too conservative is certainly a source of pressure on the board of directors, as is a management that's too flamboyant, and perhaps too aggressive for the good of the company. And, we are all familiar with hostile takeovers. I've been in two of those situations though, fortunately, not at my own company. That was two too many.

Some older directors really come in handy when you have such pressures, because to handle the problems that come up, tremendous time is required for meeting after meeting. You certainly need some directors who have the experience and, very importantly, the time that they can donate to get involved grappling with these issues, because a CEO who has a company to run doesn't have all that time when it's necessary.

What should you do when you're under pressure as a board? The first thing is to keep your head. Don't get rattled. Try to make rational decisions. Make sure that you have all the facts, whatever the issue is, and don't just jump the gun or go off half-cocked without getting the facts.

Another thing that I think is necessary is to do something. Don't procrastinate. Then the whole world is concerned about whether or not you are really involved as a board. Do something. Get help when you need it.

As a matter of fact, it's a good idea to have your help lined up in advance, because companies and boards should play "what if" games more than they do. What if we have a hostile takeover...