HOUSTON, TX – January 23, 2007 – Because moving beyond traditional governance activities is uncertain ground for many Boards and Board members, Ephor Group has created “
Top Ten Mistakes Made by Company Board of Directors” to guide private board directors. This article identifies prevalent board mistakes and details how to avoid common traps.
Relegating the
Board of Directors to classical governance issues alone fails to take advantage of the experience and knowledge the board has to offer. By providing strategic leadership, boards can create value while ensuring successful performance.
It has been proven repeatedly that good governance leads to higher valuations. Evaluating management, driving corporate culture, and setting strategic direction are all board responsibilities critical to maximizing shareholder wealth. Board membership is a responsibility that goes beyond the bounds set by management presentations and board meeting agendas.
"Top Ten Mistakes Made by Company Board of Directors” includes:
Mistake #2: Exiting for the Wrong Reasons: Knowing when to exit is the most misunderstood issue facing investors today. An exit should be the result of a strategic initiative to seek a realization and not the result of factors that make an exit imperative. The most common reason to exit -- market timing -- is often also obvious to strategic buyers and will negatively impact the value at realization.
When an exit is appropriate and desired the solution is to manufacture the outcome through strategic planning. The key is positioning the company to be strategically valuable for the right reasons to the right buyers at the appropriate time.
Mistake #3: Not Strategically Positioned: A company can have great technology, people or operating history, but still fail to produce expected gains.
This is a typical problem, but the numbers will not expose the issue, because the problem is not in the execution of the business so much as in the firm’s strategic positioning.
Read all ten common board mistakes in the full, complimentary article
"Top Ten Mistakes Made by Company Board of Directors” at
http://www.ephorgroup.com/download_board_mistakes.asp
