Where Have the Directors Gone?

This article from Fortune magazine highlights another unintended cost of Sarbanes Oxley. It's getting harder and harder to attract good directors. According to their data, half of the outside directors at Fortune 1000 companies are quitting. As for the reasons:
Simon Francis, a partner at executive-search firm Christian & Timbers, attributes a lot of empty board seats to conflicts of interest, perceived or real. "For example, it's now viewed as bad form for the chairman of the audit committee to also sit on the executive-compensation committee, or vice versa," he says. "You can't be both gamekeeper and poacher." Further shrinking the pool of outside-director candidates are restrictions on how many outside boards a CEO may join. In 2001, according to an exhaustive study of corporate boards' composition by executive-search giant Korn/Ferry International, just 23% of U.S. companies had such limits. Now more than half (51%) restrict CEOs to no more than two outside directorships.
Click here for the whole article.

The good news is that director compensation is rising. Now, if I can only get a few directorships...