What to ask before joining a board.

• Author: Joseph, Stephanie R.
• Position: Advice to the Rookie Director

Here are 10 fundamental questions that can serve as guidelines in evaluating a board invitation.

Much has been written about the growing challenges confronting boards of directors today. The intensified focus of investors on board performance, increased public outcry for boardroom accountability, and explosive growth in litigation involving board members are constant reminders of the legal liabilities and potential for personal financial loss thrust upon directors in their roles as adviser, monitor, and caretaker. Clearly, boardroom candidates must carefully weigh the risks and rewards of directorship before accepting, or declining, an offer to serve.

Just as any company would conduct a thorough search to establish, diversify, or replenish its board, prospective directors must be proactive and diligent about getting to know the company and the board they're thinking about joining. No two boards are alike. What candidates learn about the role and responsibilities of the board under consideration, including the relationships it fosters with shareholders, the CEO and management, and other corporate constituents, should form the basis of arguably one of the most important decisions in a corporate career.

The information candidates gather can also prove invaluable if they elect to serve. Less than haft of the companies surveyed recently by SpencerStuart reported having a formal indoctrination program designed to introduce the company to new directors. Given the high stakes involved, every new director - and director candidate - should embark on a personal fact-finding mission to move quickly up the learning curve. Here are 10 fundamental questions that can serve as guidelines in an evaluation of a board invitation.

1. Why am I being asked to serve on the board? Why should I accept?

   Some companies view directorships as a way to gain specific expertise, insight, and contacts while others use them primarily to help credentialize a company to the investor community. Generally, CEOs differ in the degree to which they depend on the board for independent counsel.

   By the same token, a directorship can be regarded as an opportunity to gain something in return for your own company. Perhaps the company in question is active in markets that your company is considering to enter for the first time. By sitting on the board, you would benefit from another's experience in these markets.

   Most importantly, however, is deciding whether board membership is really something you would like to pursue and whether, as a director, you would be able to make an...