The purpose of the research and paper is to ensure that the views of incumbent directors are not ignored. This is against a background of baying for reform from the media, politicians and badly burned investors following the wave of corporate scandals.
This research was conducted by members of the Board practice of Boyden global executive search. It comprised focus groups of incumbent directors in the USA and Australia as well as interviews in these countries and in the UK.
Directors had been holding back. They felt that new regulations and restrictions would have major impacts. There is the danger that over‐regulation in the developed world will merely drive even more business and jobs offshore to more loosely governed economies in the Far East.
The research sought the point of view of incumbent directors. One needs to consider that their comments and feedback might be self‐serving. The number of countries included was limited, though they include those to the fore in governance debate and thinking.
Regulations need to have the flexibility to be altered relatively easily lest they have deleterious effects. Those involved in Board recruitment, especially nomination committees need to be alert to the dangers of new regulation explained here.
This paper adds a different and relatively unheard viewpoint to the current public debate and regulatory climate. It sounds important words of caution to those whose knee‐jerk reaction is that tough new regulation and lots of it must be introduced immediately.
Clarke, C. (2006), "The sum of all fears: do directors have valid concerns on the unintended impact of new regulations?", Corporate Governance, Vol. 6 No. 1, pp. 6-10. https://doi.org/10.1108/14720700610649418Download as .RIS
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