Lansing Crane served his family business for over 12 years as the CEO and chairman of Crane & Co. Inc., a 213-year-old company that manufactures and sells high-security currency products, fine cotton stationery and high-performance, non-woven materials for filtration and insulation. He retired from the company in 2007 and has held board appointments with several private companiesâincluding family-owned operations.
Today, Crane serves as chairman of the board of SOG Specialty Knives & Tools, Canal Insurance Company, and Wellsâ Enterprises Inc. He is also a senior adviser on mergers and acquisitions and family corporate matters to Brown Brothers Harriman & Co.
We asked Crane to provide some insight into his private board service and how his experience leading his own family company has helped prepare him for being a director of other family businesses.
Family Business: Can you tell us a bit about your background leading your own familyâs company as CEO?
Lansing Crane: For 12 years, I was the CEO of the business and for 15 years I was chairman of the board. During the time I was there, I really professionalized the management group and the board. The board had been a typical family board back in 1995, and by the time I was done, it was a significant mixture of capable family members and independent directors.
FB: Why did you decide to change up the board of directors at your family company?
Crane: The company needed to be globally competitive. In order to achieve that, we needed a board that could provide the conditions of success and the overall guidance that would take us from being a regional domestic company to a position where we could compete internationally with very substantial, successful, deep-pocketed companies. We needed to transform the culture of the company, and it started at the board of directors.
FB: How has your background prepared you to serve on the boards of other family-owned companies?
Crane: Iâm in an unusual position. Iâm a family member who used to be CEO of his familyâs business. When I am a board member of other family companies, I bring an experience that the family executives in those businesses, particularly the family CEOs, can find helpful.
FB: What is the difference between serving on a family company board versus a private company board? Are there distinctions?
Crane: For the private company boards where there are investors, itâs more a question about directors that have the right alignment with an investment group. Itâs a little easier to have alignment between management, board and ownership. With family companies, the cultural issues make alignment a greater challenge.
FB: What do you think family businesses should look for in a board director?
Crane: An effective board is a culture, and all directors should represent all shareholders equally. That is just as important for family business directors. You have to be prepared to challenge thinking. You have to have an understanding of the difference between a boardâs role and managementâs role. Itâs the ability to think critically, to say no, and to think as an owner. When we pick family directors for our board, one of the criteria that we adopted was that family members had to be capable of being on anyoneâs board. Decisions should be made on merits. Family doesnât trump.
FB: What kind of time commitment is required for directors of private and family companies?
Crane: An effective director really does have to be prepared to devote a significant amount of time to the work. As an estimate, itâs somewhere between 200 and 300 hours a yearâmore if youâre the board chair. There are always surprises and events that occur. You might have to deal with a succession issue or find new directors, or there might be an acquisition or a sale of the business unit. Whenever those events come up, they spike the work demands and you need to put in the time.