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Everyone's favorite corporate outhouse/welfare diva Bank of America (NYSE: BAC) has begun its search for directors to replace deposed former chairman Ken Lewis, along with any other directors who might step down.
The company is also considering changes to its board structure that could result in a search for more new blood, but the Wall Street Journal reports (subscription required) that the ward of the state hasn't yet hired a firm to find new directors.
Finding people to take the job shouldn't be any great challenge. According to the company's latest proxy statement, each non-employee earns (for lack of a better word) $80,000 in cash per year and $160,000 worth of restricted stock. And what exactly do they do? Given that Ken Lewis was allowed to make a pair of terrible acquisitions and keep his job, it appears that directors don't really do much of anything.
The only problem that Bank of America will have in setting standards for prospective board members will be the appearance of hypocrisy. Given how pitifully poorly the company's current directors have performed in their fiduciary duties to shareholders, how could they possibly turn down anyone for a seat on the board?
True: They might lack experience in turning one of America's most powerful financial institutions into an over-leveraged pile of junk dependent on government handouts for survival, but they can always get on-the-job training from the current board in that art.
If Bank of America wants to get serious about improving its corporate governance, it needs to relieve every single current board member of his duties and start fresh.
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Reader Comments (Page 1 of 1)
5-08-2009 @ 5:53PM
Kent said...
Speaking with friends and business contacts at BOA, not one has given the thumbs up when it acquired Country-Wide and Merrill Lynch. Lewis not only has to do some explaining to the shareholders but also to his own in-house people as well to make it work.