Best Practices

High achieving, hard drivers can sabotage the enterprises they create.

 


Three strategies for building your board.

 


How a more effective board of directors can help a family business prepare for the future.

 


Three characteristics of the best private company boards.

 

A theme running through this issue of Private Company Director magazine, and the theme of our upcoming Private Company Governance Summit 2016, is what is involved in building a high-performing private company board.


Top businesses typically have high-performance human capital backed up with solid management processes that provide continual feedback to employees and reward talent for creating measurable profitability. Those who cannot perform to benchmarks are “managed out.” High-performance boards take a similar approach to managing themselves, via continual feedback and appropriate rewards for driving shareholder value.


John J. “Jack” Brennan is chairman emeritus and senior advisor of Vanguard Group Inc. With assets totaling over $3.1 trillion, Vanguard, based in Malvern, Pa., is the largest mutual fund company in the world. Following his undergraduate education at Dartmouth College and an MBA from Harvard Business School, Brennan started out his career with a private company, household cleaning supplies manufacturer S.C. Johnson & Son. He joined Vanguard, another resolutely private company, in 1982 as assistant to Vanguard founder John Bogle.


Results from a 2014 board compensation survey offer some benchmarks for private company owners and directors.

Private companies continue to struggle with the question: “How much should we pay our directors?” There are many variables that determine director compensation: number of yearly meetings, industry, business size, business structure and more.  The challenge private companies’ face is that there are few data points against which private companies can benchmark their Board compensation plans. 


Trust and Culture

Building confidence in the strategic value of independent directors.

By Eve Tahmincioglu

 

What Private Boards Can Learn From Public Boards

An interview with Dennis Chookazian, retired chairman and CEO of CNA Insurance Companies.

By Roger Nanney

 


Best practice for any family business seeking to transition to the next generation is establishing good governance that is appropriate for the particular circumstances of the family and its enterprise. But, practically speaking, how does this evolve? Consider the following case of a family-owned manufacturing firm and the factors that led the founder to invest in the development of an independent board.