Reader Profile: Director Conduct

December 2009Articles Boards & Directors

Each month, Boards & Directors asks a reader to comment on critical issues directors encounter. David discussed the scrutiny, pressure and risks boards of directors face in today’s economy, specifically with insolvent companies seeking restructuring alternatives. Directors have to be particularly aware of the legal standards and obligations that need to be upheld, and recognize that stakeholders are no longer colleagues, but rivals, and balance shareholder interests with those of creditors. Boards also need to understand the role of their special committee to identify potential conflicts of interest and other hot points to ensure fair decision-making. Directors, officers and their advisors need to be proactive in minimizing such risk.

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