Best of the best: a lifetime of achievement
Ira Millstein, respected pedagogue, consummate attorney and revered thought leader, was picked by his peers to win the ‘Lifetime achievement award in corporate governance’ sponsored by Georgeson. A senior partner at Weil, Gotshal & Manges, he is widely praised for being a trailblazer in the corporate governance realm. An advocate for improving corporate governance through dialogue and consensus-building, he helped launch Yale’s corporate governance center (renamed in his honor as the Millstein Center for Corporate Governance and Performance in 2006), not so experienced practitioners in the fields of business, public policy, academia and governance could be lectured to, but so they could converse with their peers and generate thoughtful discussion.
As senior associate dean for corporate governance and Eugene Williams Jr visiting professor in competitive enterprise and strategy at the Yale School of Management, Millstein continues to inflect his attuned approach to governance, built on a lifetime of experience. ‘All the companies I represented, the speeches I made and the contacts I have all over the world led me to believe that it would be wonderful to have one place, without a bias and without any necessary agenda, where people could come and discuss the most important issues in corporate governance and conceivably come up with either recommendations or principles to improve the system,’ he explains.
Millstein has witnessed the positive effects of providing a forum for discussion firsthand, for example, through the formation of industry membership groups and thought papers that emerged as a result of the Millstein Center’s convening power. ‘We have established a forum for independent chairs of mutual funds and one for independent chairs of corporate boards. Roundtables for each group have provided an opportunity to share ideas and experiences, and to potentially create a set of best practices. Additional gatherings of industry experts have also resulted in a series of policy papers on various topics including how rating agencies factor governance into their ratings, the integrity of proxy voting and board-shareholder communication around the issue of executive compensation,’ he says.
His knowledge of antitrust, government regulation and corporate governance matters was generated during an expansive and diverse career which includes being a board member and former chairman of the Board of Overseers of the Albert Einstein College of Medicine, chairman emeritus of the Private Sector Advisory Group of the World Bank/Organisation for Economic Cooperation and Development (OECD) Global Corporate Governance Forum and a board member of the National Association of Corporate Directors (NACD), and having counseled over 50 boards of directors of profit and not-for-profit corporations. He also served as chairman of the New York State Commission on Public Authority Reform, as a fellow of the faculty of government at Harvard University’s JFK School of Government and as co-chaired the Blue Ribbon Committee on Improving the Effectiveness of Corporate Audit Committees.
With such extensive credentials, it’s no small wonder that accolades for both his professional skill and personal character are just as abundant. ‘Ira’s contributions in terms of education, and in bringing [governance] to the attention of the stakeholders in American capitalism, is second to none,’ says Kenneth Daly, president and CEO of NACD. ‘I view him as a personal friend and I think he’s just a spectacular person.’
Putting the tone at the top
Millstein’s dedication to impressing the critical role of the board of directors in corporate governance has enhanced the awareness of this area among US companies. ‘He is Mr Corporate Governance as far as being the leading expert on what really works in the boardroom,’ comments Daly. ‘He has a passion for boards and for making them as effective and as productive as possible and his opinions are steeped in years of experience and in practiced patience.’ Millstein has witnessed the positive effects of increased governance discussion in the formulation of strong ideas on the subject that have emerged from the Millstein Center. ‘We have some very concrete reports that have come out on ratings agencies, on communications, on independent directors,’ he says.
Although in recent years there has been much debate about the need for governance reform, the essential rules have stuck. Millstein’s work as chairman of the OECD Business Sector Advisory Group – which led to a report that evolved into the OECD Principles of Corporate Governance – helped define many of the basic rules companies around the world follow today.
Yet the reams of material written on corporate governance have created a ‘cottage industry’, observes Millstein. ‘There’s no dearth of information on what directors ought to be doing,’ he adds, such as ‘adhering to the ‘Key agreed principles’ recently released. As for whether directors are taking cues from the information on offer, he observes, ‘I think they’re aware of almost everything, the question is whether they’re doing it.’
‘In the case of the latest financial meltdown,’ notes Millstein, ‘it’s clear that some of the best boards in the world made up of very good people just weren’t getting the job done – not paying attention to, or asking the right questions about, the risks these companies were undertaking. The question at this point in history is what are the lessons learned and how do boards behave differently going forward?
Certain company roles could come to the fore to expedite this transition and to help boards do better. ‘I think that the general counsel and the corporate secretary are at the cutting edge of getting it done within a corporation,’ says Millstein. ‘Groups like NACD, the International Corporate Governance Network, Council of Institutional Investors and the Business Roundtable will also play a strong role as resources for boards,’ he adds. But in order to make sure good governance becomes a value system truly endemic to corporations, according to Millstein, the onus is on everyone to take the lead.
Other nominees for the lifetime achievement award are also making leaps and bounds in terms of encouraging governance awareness, including Warren Batts from the University of Chicago, Dennis Beresford from the University of Georgia, Peter Clapman from Governance for Owners USA, Robert Monks from The Corporate Library, Stephen Norman from American Express and Larry Sonsini from Wilson Sonsini Goodrich & Rosati.