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A Sept. 23, 2008, file photo of Gail Cook-Bennett, chairwoman of Manulife Financial Corp. (Fernando Morales/Fernando Morales/The Globe and Mail)
A Sept. 23, 2008, file photo of Gail Cook-Bennett, chairwoman of Manulife Financial Corp. (Fernando Morales/Fernando Morales/The Globe and Mail)

Board Games

Verbatim: Prominent corporate directors on how boards have changed Add to ...

2011 marks the 10th year of Board Games, The Globe's annual report on corporate governance. See the rankings: Related content2011 corporate governance rankings and see the full 2011 Board Games website here.

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“Certainly if individuals and young people who cannot find jobs look at some of the sources of the financial meltdown, they’ve got a fair bit to be angry about. Then fast forward to the boards of directors. Some of them may not be trying, I have no idea. But the people I talk to, the directors are really trying to respond. It’s a hugely complex task. I have a particular philosophical bias that if you put smart people in a room and you rely on the wisdom of the group and give them a chance to contribute the way they have a competitive advantage in contributing, then you should get some wise outcomes. It doesn’t always work. But that’s the best we can do, I think.” -- Gail Cook-Bennett, chairwoman of Manulife Financial Corp.

More from Board Games 2011

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“Our members wouldn’t be paying their money for CCGG membership if they didn’t believe there were valid things being done here. They wouldn’t be doing it if they didn’t believe that having good governance decreases risk and increases long-term sustainable performance. We’re not talking about stupid people. We’re talking about major pension funds and institutional investors. And they do believe in the value of good governance.” -- Stephen Erlichman, executive director of Canadian Coalition for Good Governance, representing major institutional investors

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“It wasn’t that many years ago where it was more at the board level ‘Speak when spoken to.’ And the [combined]chairman and CEO held the gavel and dominated the discussion and the content of the discussion. The advent of the non-executive chairman has meant a board participates in the setting of the agenda for meetings. With all of that, and much more interactive discussion and debate and critique on a variety of issues, I think the board dynamic has changed rather dramatically, not just on bank boards but on all boards.” -- John Mayberry, chairman of Bank of Nova Scotia

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“I think it’s really important to keep your eye on what you’re there for, which is for the business and long-term value creation. You can’t get preoccupied with governance changes, I think that’s a mistake. But I’ve seen a move from saying, ‘Oh, corporate governance? Let’s check all these boxes.’ [Now]it’s just a way you do business yourself, the way you conduct yourself. It’s just embedded in everything. It’s not something that’s separate over here that’s a check list. It’s just how you do what you do.” -- Mary Mogford, director of Potash Corp. of Saskatchewan and Nordion Inc.

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"If I had to use one term to characterize boards 15 to 20 years ago, that would be ‘passive.’ Today in my experience, they are very engaged. Fifteen or 20 years ago, management had a much more active role in deciding issues than they do today. Today the agenda is a co-operative effort between the chairman of the board and management. ... A lot of boards were constituted with people connected to the CEO and they felt beholden to the CEO. It made it difficult for them to challenge what management wanted to do. That, in my experience, has completely changed." -- Peter Dey, director of Goldcorp Inc. and MI Developments Inc.

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"Over the 10 years, I would say the most important change has been the ability of the board to function independently of management. The members of the board now meet independence tests, so it’s not the old-style friends of the CEO. In the old days, it was all mixed up as to the management and the board, and they were always together. I think the board lost any sense they were really responsive to the shareholders." -- David O’Brien, chairman of Royal Bank of Canada and Encana Corp.

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"If you have a board that’s well-constituted, well-led and works as a social group, then it’s probably not a lot more effective now than it was 10 or 15 years ago, because that’s the key thing. ... Like any performance-improvement scheme, people are distributed along a bell curve. There are 10 or 15 per cent of the population who don’t need the help because they do it intuitively and 10 or 15 per cent who can’t be helped, and then there’s the great middle who by practice and instruction can get 10 or 15 per cent better. I would say that’s where it’s had the impact is in the middle. It hasn’t made boards that were hopeless workable or boards that were very good better." -- Brian Levitt, chairman of Toronto-Dominion Bank

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"You’ve got to roll back the notion that boards are there as agents of shareholders, and go back to the more holistic notion that boards are there with a fiduciary responsibility to the corporation, which includes shareholders. ... But you’ve also got your management teams. And more and more we see with these 'occupy' movements that you’ve got to earn the social right to operate. So if you are in charge of the fiduciary responsibility for the corporation, I think you have to have a more holistic definition now, and you have to get away from the idea that our job is to maximize shareholder value in the next quarter." -- David Beatty, chairman of Inmet Mining Corp.

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“It seems to me that in fact, while I wouldn’t call it an earthquake or a tsunami, there’s certainly been an appreciable change in the importance of the board, the role of the board and the influence of the board. I think it means that the 'imperial' CEO – a breed far more common south of the border than in Canada – has, if not quite disappeared, certainly diminished in number and in stature. ... I think it means that the traditional tendency of many CEOs – thank God not all – to press for excessive compensation and benefits and perks and pensions, I think is less than it was. The fact we’re still in the middle of a major recession may have had something to do with it, too." -- Bill Dimma, director of Magellan Aerospace Corp., former director on 55 corporate boards

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"Corporate governance changes have required significant effort from boards to ensure appropriate work processes are in place for operations, financial results and in environment, health and safety, to name just a few areas. But the board must make sure that the 'how' – process – doesn’t overwhelm the 'what' – strategy, entrepreneurship and decision-making. The most effective boards will consciously seek this balance." -- Francis Saville, chairman of Nexen Inc.

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