The Board of Directors and Corporate Governance

Submitted by: Tom Barrow

 

 

Class 1: Introduction

 

Case

The Board of Directors at Morgan Stanley Dean Witter (Harvard).

 

ASSIGNMENT

1. What is your assessment of the manner in which the Morgan Stanley board has handled this crisis?

2. How do you explain their decisions?

 

Class 2: Shareholder Types

 

Cases

California PERS (A), (Harvard).

California PERS (B), (Harvard).

 

ASSIGNMENT

1. What is your assessment of CalPERs' approach to corporate governance?

2. What other approaches might they have adopted?

3. Why have "public" institutional investors like CalPERs had such impact on the practice of corporate governance?

4. How do other types of institutional investors think about these issues, e.g., mutual funds; hedge funds?

 

Class 3: Selecting Directors

 

Readings

Chapter 6 in Back to the Drawing Board

"Election Contest in the Company's Proxy: An Idea Whose Time Has Not Come" by Martin Lipton and Steven A. Rosenblum

Board Composition and Committee Statistics

 

Cases

Eastman Chemical Company: Building a Board from Scratch, (Harvard).

SEC Proposal for Nomination of Directors by Shareholders, (Harvard).

 

ASSIGNMENT

1. What is your assessment of the manner in which the executives at Eastman selected directors for this new board?

2. Regardless of your thoughts about question 1, it should be clear that shareholders were not consulted. Given this

fact, and that it is a truism that shareholders have a very limited voice in nominating directors, what are your thoughts

about the SEC's proposal?

 

Class 3: Board Meetings

 

Readings

Chapter 8, Back to the Drawing Board

ASSIGNMENT

1. What is your assessment of the Cardninal board meeting?.

2. How effectively did Bob Walters lead the meeting? What did he accomplish? What did the directors achieve?.

3. How typical do you think this meeting is? What could be done to improve the effectiveness of such meetings?

 

Class 4: The Board's Role: Advice, Decisions and Monitoring

 

Readings

Chapter 4, Back to the Drawing Board

 

Case

Board of Directors at The Coca-Cola Company, The, (Harvard).

 

ASSIGNMENT

1. How has the role of the Coca-Cola board changed over the company's history?

2. More specifically, how has the board been involved in shaping the company's stratgegic direction?

3. What is your assessment of the way the board and Mr. Daft handled the potential acquisition of Quaker Oats?

4. In 2003, how would you evaluate the Coca-Cola board if you were a shareholder?5. Do you agree with the frequent

media criticsm of the Coca-Cola board?

 

Class 5: Boards at Work: Legal Responsibilities and Obligations

 

Readings

 

Class 6: The Board and the CEO

 

Readings

Chapter5 and 6 in Back to the Drawing Board

 

Case

Board of Directors at Medtronic, Inc., (Harvard).

 

ASSIGNMENT

1. What issues do Win Wallin and Bill George face as they think about the Medtronic board?

2. What changes in board structure, procedure, and practice would you recommend to Bill George?

3. Is the Medtronic board better off in 1999 than it was in 1993?

a) From the point of view of the CEO?

b) From the point of view of the outside directors?

c) From the point of view of the shareholders?

 

Class 7: Evaluating and Rewarding the CEO

 

Readings

 

Cases

Executive Remuneration at Reckitt Benckiser Plc, (Harvard).

CEO Evaluation of Dayton Hudson, (Harvard).

 

ASSIGNMENT

1. What is your assessment of the Reckitt and Benckiser compensation program?

2. How should CEO evaluation by the board be related to the CEO's compensation?

3. Think about how you could improve the Dayton-Hudson approach described in the note.

4. In general, what are the difficulties and benefits of CEO evaluation by the board?

 

 

Class 8: The Board and Corporate Goals

 

Cases

Philips Electronics NV, (Harvard)

 

ASSIGNMENT

1.What is your assessment of corporate governance at Philips?

2. How is it different from American corporate governance we have been discussing?

3.What impresses you, positively, about Philips governance and what concerns you?

 

Class 9: Director's Panel

 

Readings

 

Chapters 1-3 in Back to the Drawing Board

 

 

Class 10: Disney

 

Cases

Michael Ovitz and The Walt Disney Company (A), (Harvard)

 

ASSIGNMENT

1. How well did Eisner and the Disney board handle Ovitz employment and compensation?

2. How well did they handle his departure?

 

Class 11: Replacing the CEO

 

Cases

American Express (A), (Harvard)

American Express (B), (Harvard)

 

ASSIGNMENT

1. Should Jim Robinson have been removed as CEO?

2. What is your assessment of the manner in which this was done?

3. What lessons about corporate boards does this situation teach you?

 

Class 12: Jamie Dimon and Bank One

 

Class 13: Assuring Information and Knowledge

 

Readings

 

Chapters 7 in Back to the Drawing Board

 

Case

Governance at Metallgesellschaft (A), (Harvard).

 

ASSIGNMENT

1. Did Schmitz and the Supervisory Board do all they could have done to understand and correct the problems faced by MG AG?

2. Does this situation suggest flaws in the German system of corporte governance? If so, what are they?

 

 

Class 14: Vivendi

 

Case

Messier's Reign at Vivendi Universal, (Harvard).

 

ASSIGNMENT

1. How much responsibility does Vivendi's board bear in its decline?

2. What were the conditions that contributed to Messier first being regarded as a corporate hero and then a failed CEO?

3. What was the role of the business media?

 

Class 15: Hostile Takeovers

 

Cases

Quickturn Design Systems, Inc. (A), (Harvard).

Quickturn Design Systems, Inc. (B), (Harvard).

Quickturn Design Systems, Inc. (C), (Harvard).

Quickturn Design Systems, Inc. (D), (Harvard).

Quickturn Design Systems, Inc. (E), (Harvard).

Quickturn Design Systems, Inc. (F), (Harvard).

Quickturn Design Systems, Inc. (G), (Harvard).

 

ASSIGNMENT

1.  If you had been a Quickturn (QT) director in August 1998, how would you have interpreted the Mentor offer?

2.  From your perspective as a student, how well has the QT board responded to the offer up to this point?

3.  As a QT director, what would you decide about the Mentor offer?

 

Class 16:

 

Case

Hewlett-Packard Company: The War Within, (Harvard).

 

ASSIGNMENT

1. How and why did the H-P board get into this situation?

2. What could have been done by the board and the company leaders to prevent these problems?

3. What should be done now to improve the board?

 

Class 17:

 

Case

AFL-CIO: Office of Investment and Home Depot, (Harvard).

 

ASSIGNMENT

1. If you were on a board which received a letter from the AFL-CIO Office of Investment criticizing some aspect of your company, how would you react?

2. What are the goals of the AFL-CIO Office of Investment? How are they similar or different from other institutional investors? (In this regard you may want to think back to our discussion of CalPERS.)

 

Class 18:

 

ASSIGNMENT

1. If you are on the board of a company (e.g., PerSe) and ValueAct offered "advice", how would you respond?

2. Compare ValueAct's approach to that of other activist investors, e.g., Icahn, or a hedge fund.

 

Class 19:

 

Case

OppenheimerFunds and Take-Two Interactive (A), (Harvard).

 

ASSIGNMENT

1. What should Emmanuel Ferreira do? Why?

 

Class 20:

 

Class 21: Family Owned Companies

 

Case

 

Stevenson Industries (A), (Harvard).

Stevenson Industries (B), (Harvard).

Stevenson Industries (C), (Harvard).

 

 

ASSIGNMENT

1. How did the impasse between Simon Carlson and Paul Steel emerge?

2. What is unique about a family board compared to a public-company board?

3. If you were a non-family member on the Stevenson board, what actions would you take?

4. What should Simon Carlson do?

 

Class 22:

 

Cases

United Way of America: Governance in the Nonprofit Sector (A), The United Way, (Harvard).

United Way of America: Governance in the Nonprofit Sector (B), Kenneth W. Dam Becomes Interim President, (Harvard).

 

ASSIGNMENT

1. What factors contributed to the problems at UWA?

2. What actions should Kenneth Dam take in the short term (3-4 weeks) to stabilize the UWA?

 

Class 23: Private Equity Boards

 

Case

Kinetic Concepts, Inc., (Harvard).

 

ASSIGNMENT

1. How has each of the following -- management, investors, and the board -- contributed to the success of KCI?

2. Based on the KCI experience, what differences do you see between the governance of a privately-owned company and the public ones we discussed earlier?

 

Class 24: Trinity College

 

Cases

Trinity College (A), (Harvard).

Trinity College (B), (Harvard).

Trinity College (C), (Harvard).

Trinity College (D), (Harvard).

 

ASSIGNMENT

1. How would you have handled the phone call from Tom Gerety in which he indicated that he was being tempted by an offer from Amherst?

2. Assess Alfred Koeppel's actions to this point. Would you have done anything differently?

3. What would you do next?

 

Class 25: The Making of a New Profession

 

ASSIGNMENT

1. What were the circumstances and reasons for the founding of Harvard Business School? Are they still relevant?