Restructuring the Corporate Board of Directors: Fond Hope–Faint Promise?
Reforms, then, have been instituted, and an extensive literature on corporate reform has developed. It is time that we seriously examine the reforms and the literature to assess the accomplishments and possibilities of the corporate board of directors. This Article is a first step in that direction.
The Article begins by investigating the reasons for the impotence of corporate boards. It then examines two models of reformed boards and finds both models badly flawed. The Article proceeds to case studies of three corporations-Mattel, Inc., Northrop Corp., and Lockheed Corp.-which under court· order have attempted to reform their boards by increasing the proportion of outside directors and by establishing more board committees. The case studies suggest that the problem of corporate reform is too complex and intractable to respond to so simple a solution as the reform of corporate boards. Our efforts to revive the board of directors are simply anachronistic; new methods must be devised if we are to make corporate management genuinely accountable.