The best directors ... and how they become the best: my 10 principles for success in your role as a board director.

• Author: Vincent, Fay
• Position: ROAD TO XL * KEYNOTE

Over my long career in the law and business, I have been a director of more than a dozen public companies and a senior executive of several others, including the Coca-Cola Co. In addition, I served on the boards of several nonprofit institutions. Finally, though briefly, I served at the top staff level at the SEC. I have been an observer of directors of fine companies, and also watched as badly run companies were poorly served by their directors.

With the humility of one who has violated some of the following principles, I offer these thoughts on the traits of the best directors:

1. Financial acuity is essential. If you do not understand the accounting methods of a business, your ability to serve properly will be severely compromised. I remember appearing at my first board meeting as a new director of a large company and when I inquired about a current cash statement, I was assured the financial department was working to prepare such a statement. Cash is the crucial fuel of any business and I was stunned this company had no current cash data. To serve well on a board one must become totally familiar with the financial statement and methods of accounting. This is not an easy task.

2. No director should ever speak for or in the name of management. The failure to adhere to this rule must be a capital crime. I saw misguided directors regularly assure employees or even press that the company would perform some task when only the CEO should be able to pro vide such assurances. Directors are not part of management and have to know their place.

3. No director has to be expert in every area. In large companies, the board will have several committees and a wise director will choose an aspect of the board functions in which to be acutely knowledgeable. Finance, governance, external and government relations, audit and compensation offer opportunities to become helpful to the full board.

4. Keeping quiet for the first few months or even years on the board is often wise and sometimes essential. Questions are always appropriate unless one becomes too intrusive. But offering opinions as a new director can often demonstrate ignorance when experience on the board will soon answer many initial questions. I found it wise to sit next to the same more senior director and to ask that more experienced director my untutored questions.

5. Find the older and more experienced directors and watch how they function. I suggest there are almost always several directors who...