1. The Best and Worst Boards Business Week January 24, 2000 January, 1997

2. Attributes of a Good Board INDEPENDENCE. –Friends and cronies of the CEO are out. –Crucial panels like audit should contain no insiders. –Cross-directorships are taboo. QUALITY. –Board meetings should include real, open debate. – Directors need to be familiar with managers and conditions in the field. ACCOUNTABILITY. –Directors ought to hold serious stakes in the company. –They should also be prepared to challenge under- performing CEOs.

3. Judging Independence No more than two inside directors No inside directors on its audit, nominating, & compensation committees No outside members who directly or indirectly draw consulting, legal, or other fees from the company No interlocking directorships Extra points for meeting regularly without the CEO

4. Accountability to Shareholders All directors own a minimum of $100,000 in stock Extra points for not offering pension benefits to BOD Extra points for having elections every year Boards meet at least four times per year Audit committees meet at least three times per year Lost points for BODs that fail to evaluate their performance

5. Underinvested? Charles BlalackAMD0 Reveta BowersDisney0 Richard HackbornMicrosoft0 Charles YoungIntel200 David AbshireOgden288 Gary WilsonDisney1,000 Aziz SyrianaOccidental1,450 Wilton LooneyRollins1,500 George NolleyOccidental2,280 Thomas WymanAT&T2,570

6. Director Quality Fully employed directors sit on no more than three corporate boards, and retired directors on no more than six At least one outsider with experience in company’s core business At least one outsider on audit committee with financial or accounting background Extra points if at least one CEO of a company of similar size or stature Directors attend 75% or more of meetings Board has no more than 15 directors

7. Stretched too thin? Ann McLaughlin13AMR, GM, Kellogg Raymond Troubh13Time Warner Frank Carlucci12Ashland Oil, Westinghouse Allen Jacobsen113M, Prudential, Abbott Labs Willie Davis10Dow Chemical, Johnson Controls Vernon Jordan10Bankers Trust, Ryder Systems Claudine Malone9Dell, Hannaford, The Limited Joseph Califano8Kmart, Travelers, Warnaco Carl Reichardt8Columbia/HCA, Ford

8. Too many no-shows? David K.P. LiDow Jones, Westinghouse 45%, 40% Gareth ChangMallinckrodt44% Vernon JordanDow Jones40% James MiddletonArco Cehmical31% John OngAmeritech31% Donald FlynnWaste Management30% Jill BaradMicrosoft29% Boone Powell, Jr.Abbott Labs27% John KlugeOccidental25% Sidney PoitierDisney25%