“Watch Out,” are the key words in this heavily time-consuming corporate structure designed by lawyers and SEC officialdom, few of whom have ever run a business.
- Don’t make the mistake of thinking your directors are your friends. Between being compensated for attending meetings with little to do but read reports that you prepared for them and the hyped-up fear of director’s liability, your ‘friends’ will view you as a hired gun, which after all you are.
- The board will drop you like a hot potato if you have any whiff of scandal about you.
- Remember the directors are there for personal gain, whether it’s prestige, compensation, options, corporate perks or free golf balls. Don’t believe it, try finding directors without them.
- Keep extensive notes of all board meetings, conference calls, personal outings in your files. Board members can have short memories.
- All that being said, be attentive to them, to their ideas, and invite them to appropriate events.
- The board sets your compensation, which it will do by hiring a compensation consultant who will survey your industry and give the board a range of comps for your position in the industry. The typical result is the board will pay you the mean of the range. Fight back and demand the highest compensation. You have no one in your corner but yourself.
- Be modest in your personal expenses. That a board member has to sign off on your expense reports is your biggest ongoing liability. If the board turns on you, this is where it will come from.
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