One of the rewards of success for the company director is that he is unlikely to be called upon to explain his policies publicly and that, consequent upon success, shareholders, whether large or small, are likely to accept uncritically any explanation of the company's activities which the chairman thinks appropriate. In fact, unlike cabinet ministers, who seldom refuse an opportunity of discussing their r6le, or their government's policies, members of boards of directors rarely make statements about company affairs. Even in the very unusual event of a resignation of a director being proffered or sought have those who voted his adoption in the first place any clear idea as to what differences of opinion, blunders, or stupidity may have led to the disappearance of the director. Furthermore, as the process of election or selection calls for none of the skills on the part of the new director associated with the hustings, most shareholders one suspects place their trust in men unknown, unheard and unrecognized. Business success and high profits seldom come to companies all the time and to many companies but rarely. The excuse proffered is that “things did not turn out as expected” or ‐ and currently much more common — “things would have turned out as expected if only Government policy, or the economic climate had been different”. Currently many chairmen have been able to explain away losses amounting to millions of pounds simply by claiming that the national economic position is unfavourable: shareholders appear to have become so bemused by the pessimism surrounding the economic situation that they confidently re‐elect boards of directors who promise nothing better than low sales, lower returns, and lowest profits. It is not surprising that explanations such as those outlined above were accepted occasionally, but in many cases the records of his annual statements show that the chairman has been able to claim the economic situation as being unfavourable as an excuse year after year. In such cases one can only suppose that a favourable economic situation would be one in which some magic National Finance Corporation automatically multiplied profits by two if they were large, by ten if they were small, and gave some special reward for a loss. Discussions recently surrounding a number of take‐over situations, as well as the examination of Lord Robens' thesis that the chairman of a nationalized undertaking must on principle proffer his resignation if serious public criticism is levelled against the corporation, make it worthwhile to re‐examine attitudes towards directors and chairmen of companies. The case that follows invites an examination of the role and responsibilities of directors in a particular situation.
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