Modern board governance began to take shape in the United States in the early 1980s. In the early 21st century, we saw the introduction of binding regulations for financial institutions and the stock exchanges. In 2003, the Sarbanes-Oxley Act came into power.

In The Theory of Governance, John Carver wrote, "Drucker (1974) observed that corporate boards have one thing in common, 'they do not function.'" Others have characterized them as "largely irrelevant through most of the twentieth century" (Gillies, 1992), "pawns (rather than) potentates" (Lorsch, 1989), "ornaments" (Mace, 1971), and, most picturesquely, "like ants on a log in turbulent water who think they are steering the log" (anonymous, quoted by Leighton and Thain, 1997).

If boards have been ineffective for much of corporate history, they have been even more unobserved. The topic of corporate governance interested only a few.

Continue Reading for Free

Register and gain access to:

  • Breaking credit union news and analysis, on-site and via our newsletters and custom alerts.
  • Weekly Shared Accounts podcast featuring exclusive interviews with industry leaders.
  • Educational webcasts, white papers, and ebooks from industry thought leaders.
  • Critical coverage of the commercial real estate and financial advisory markets on our other ALM sites, and

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.