Corporate Governance Guidelines: Reviewing One Company's Document
General Dynamics has shared their Corporate Governance Guidelines and they make interesting reading.
- The general statement of board responsibilities does not include any discussion of risk oversight or even whether performance is optimized; perhaps these are both thought to be ‘understood.’
- That section discusses the selection but not the termination of the CEO.
- Directors are not expected to speak for the company without the approval of senior management.
- Under Qualifications, there is no mention of how the director will add value. Perhaps this will be beefed up as a result of the Frank-Dodds legislation.
- Directors may serve on as many as four other boards. Audit committee members may serve on to other audit committees.
- Directors over the age of 72 are subject to re-election restrictions.
- The CEO may act also be the chair of the board.
- Although the board and its committees perform self-assessments, there is no requirement for the assessment of individual directors.
- There is no separate risk committee (nor IT, for the IT enthusiasts).
- Whistleblower activity is not directly shared with the audit committee — it goes to the ethics officer.
- There is no statement supporting board diversity.
Posted on Feb 7, 2011 by Norman Marks
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