CEOs love to complain that the growing legion of self-appointed governance experts that criticize them just don't know what they're talking about. Few of these so-called experts have had to sit at a boardroom table and try to strike the tricky balance between entrepreneurial enthusiasm and the sober caution increasingly demanded by shareholders and regulators. But this complaint can't be made about the authors of two new books, who have had first-hand experience helping companies improve their corporate governance.
William Dimma's Tougher Boards for Tougher Times: Corporate Governance in the Post-Enron Era (Wiley; $49.99) is a lively follow-up to the author's 2002 governance primer, Excellence in the Boardroom. Dimma, known as the Dean of Canadian Directors, is one of this country's most experienced boardroom veterans, having served on more than 50 corporate boards over the past 40 years. As a director of such companies as Brascan Financial, London Life Insurance and Torstar, Dimma has attended more than 2,000 corporate board meetings. His new book incorporates not only the lessons of recent corporate flame-outs at Enron, WorldCom and Nortel, but how his personal views of corporate governance issues have been changed by those scandals and his personal experiences as a director.
Dimma argues that boards need to assume even more control over executives who, motivated by greed or hubris, drive their businesses into the ground–a view with which he was not always comfortable. “I've been coming around slowly over the past couple of years to the view that a board and its non-executive chairman must provide a strong countervailing power in relation to the CEO and management,” writes Dimma.
Dimma's latest book is written in a bright and conversational tone that is so frequently lacking in dry governance tomes that lecture directors on what not to do but offer little practical advice on how they should act. And while many governance books rely on academic studies, research and surveys to illustrate their governance prescriptions, Dimma uses his personal experiences and anecdotes to show and not just tell directors how to handle touchy situations like negotiating effective CEO compensation arrangements or even how to choose good board colleagues.
There are also plenty of personal anecdotes from directors in Building Better Boards: A Blueprint for Effective Governance (Jossey-Bass; $51.99), edited by David Nadler, chairman and CEO of Mercer Delta Consulting, and Mercer partners Beverly Behan and Mark Nadler. But the book focuses more on comprehensive details about how directors can improve the effectiveness of their boards. Several of the chapters are written by Behan, a Canadian governance consultant, and Richard Hossack, the current president of Mercer Delta Consulting Canada. While Dimma's book addresses the broad issues of governance, Building Better Boards goes into nitty-gritty and practical detail on how directors can better implement effective boardroom work processes, getting the board to concentrate on corporate strategy or create effective director evaluations. It is backed up by voluminous research as well as real-world examples.
Together, these books lay out an explicit road map for directors serious about creating boards that don't just look good, but that play a vital role in the success of corporations. Now, if some more Canadian directors will just read them.