Ingrid is a director on the board of a small listed company. The Chairman is an ‘industry veteran’ and, whilst greatly respected for his experience and knowledge is also followed by a reputation for drinking more alcohol than he can safely handle. For the past two years all has gone well and Ingrid has grown to like and admire her Chairman.
The company is now raising capital for a contentious project and, at a recent investment roadshow, the Chairman had to be forcefully removed from the room by the company’s broker because he was slurring his speech and talking nonsense. The broker is very angry that he has been made to look bad in front of his potential investors.
The board called a meeting without the Chairman at which the directors resolved to ask the Chairman to account for his behaviour and undertake either resign or cease drinking. However, when the audit committee Chair spoke with the Chairman he explained that he had been unwell and one small glass of wine which reacted with his medication to cause the incident. The Chairman refused to resign or to make any commitment to curb his drinking.
The remaining board members have, again, met without the Chairman present. They are unable to agree on how to proceed. Some want to express a vote of no confidence and seek shareholder support for removing the Chairman; others take a more lenient stance.
What should Ingrid do?
Many readers of this blog will be familiar with my newsletter The Director’s Dilemma. This newsletter features a real life case study with expert responses containing advice for the protagonist. Many readers of this blog are practicing experts and have valuable advice to offer so, for the first time, we are posting an unpublished case study and inviting YOU to respond.
If you would like to publish your advice on this topic in a global company directors’ newsletter please respond to the dilemma above with approximately 250 words of advice for Graham. Back issues of the newsletter are available at http://www.mclellan.com.au/newsletter.html where you can check out the format and quality.
The newsletters will be compiled into a book. If your advice relates to a legal jurisdiction, the readers will be sophisticated enough to extract the underlying principles and seek detailed legal advice in their own jurisdiction. The first volume of newsletters is published and available at http://www.amazon.com/Dilemmas-Practical-Studies-Company-Directors/dp/1449921965/ref=sr_1_1?ie=UTF8&qid=1321912637&sr=8-1
What would you advise?
Julie Garland-McLellan has been internationally acclaimed as a leading expert on board governance. See her website atwww.mclellan.com.au or visit her author page athttp://www.amazon.com/Julie-Garland-McLellan/e/B003A3KPUO