Bank Directors Seminar, Coeur d'Alene, ID, September 15-17, 2019

DIRECTOR CONDUCT - EXPECTATIONS  Board must set expectations about acceptable behavior  Expectations: – Prepare for meetings and follow agendas – Focus comments – Self-control (do not need to comment on everything) – Listen actively – Encourage different viewpoints – Constructively skeptical – Commit to reach a decision – Support board decisions once made (no guerrilla warfare) – Speak for board or company only if authorized – Diversity of views is good – Diversity of styles is normal

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DIRECTOR MISCONDUCT - EXAMPLES

 Disclosing board information without authority  Speaking or acting for board without authority  Competing with company’s business  Failing to disclose a conflict of interest  Trading the company’s securities without approval  Failing to comply with company’s code of conduct and ethics  Engaging in disruptive behavior at board meetings (e.g., openly dismissing comments by other directors)  Interfering with company operations (e.g., telling low-level employees how to do their job)

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