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Dilute value of non-excutives (Disagreement (removed, professional…
Dilute value of non-excutives
Nominations
Through nomination committee is not having the desired effects of curbing influence
Shareholders are not in a position to nominate directors
Too many resources needed
usually hand picked by board members
Disagreement
removed
professional scepticism = reason why non-executives are on the BOD
Sidelined
Non-executive directors
Should be chairman of BOD to enhance its credibility
Limits the power of CEO
enhances accountability and effectiveness
Many companies still have CEO as Chair :(
Shortage :/
No incentives based on performance so no desire to act in shareholders best interest
Do not pay attention to whats going on in the business because of a lack of commitment
Other
Not allocating the correct amount of time
Time limitations impact negatively on the value independent directors adds.
Interlocks executives sit on each others boards
BOARDS
Staggered boards have memebrship for 3 years but this is contary to shareholders rights as they should be able to elect annually