Failure Is Not an Option: Practical Advice for Directors Entrusted With Overseeing Corporations
In the seminal opinion Meinhard v. Salmon, future Supreme Court Justice Benjamin N. Cardozo wrote, “Joint adventurers, like copartners, owe to one another … the duty of the finest loyalty. … A trustee is held to something stricter than the morals of the marketplace. Not honesty alone, but the punctilio of an honor the most sensitive, is then the standard of behavior.”
In this article for Westlaw Today, authors Jayne Juvan and Chris Hewitt argue that, even despite recent corporate scandals, the governance paradigm Justice Cardozo so elegantly described is time-tested, well-settled, and does not need to be enhanced. Instead, Juvan and Hewitt argue that we need faithful adherence by fiduciaries to the well-developed and carefully crafted governance paradigm already in place. Juvan and Hewitt provide practical advice to boards about what it means to engage in effective oversight and advise that directors need to be able to stand up for the best interests of the organizations they oversee even when there is conflict between board members and doing so is uncomfortable.
Read the full article here.