This week’s academy session we had the privilege of hearing from three current UI Foundation in the form of a panel discussion. The members of the panel included Len Hadley, former CEO of Maytag, Casey Mahon, current director at United Fire and Casualty Company, and Kathy Dore, a Senior Advisor in Vision and Strategy to Proteus International and former President of CanWest Media. In addition, the panel discussion was held in the Old Capitol Senate Chambers. It was my first time in the Old Capitol, even though I have walked by hundreds of time during my years at Iowa in undergrad and now grad. It is fantastic and I highly recommend stopping in and take a tour!
A number of interesting points were brought up during the discussion. When asked by an audience member how to resolve conflicts between Board members, all three panel members agreed that conflict resolution between Board members is no different than conflict resolution between any other people. While board seats used to be given as rewards for a distinguished career, Boards now play an important role in a corporation partly due to the Sarbanes-Oxley Act of 2002.
When asked if Sarbenes-Oxley was good for the organizations it covers, all three board members agreed that it had positive effects. Ms. Mahon noted that it forced boards to modernize, diversify and give committees that previously may have only been in name an actual function. Ms. Dore noted that it provided more accountability, as she feels more personally responsible and therefore asks tougher questions. Mr. Hadley noted that while Sarbenes-Oxley has done a lot of good, Congress may not have taken all situations into account when making “one size fits all” regulation. He emphasized that for many small businesses, the burden created by the Sarbenes-Oxley requirements is sometimes proportional. He also noted that there are only four accounting firms that can handle large, international corporations and therefore less choice.
All in all it was a very insightful session. Mr. Hadley commented that while folks that make their way up the ladder have historically had only one boss, a CEO has an entire board of bosses. Ms. Dore shared that people with operational backgrounds and women are underrepresented on boards in the US. The role of corporate governance has evolved over the past couple of decades and will continue to evolve. As corporations become larger with more international exposure, the role of the board has increased to support CEOs as they run these corporations. We were left to ponder a question that Mr. Hadley posed: Instead of too big to fail, have corporations become too big to manage?