Bad boards of directors kill more companies than bad management…

A side-comment at the Mid Atlantic Biotech conference really got me thinking. One of the panelists mentioned as an aside that she thought that more companies failed due to bad boards than due to bad management (she preferred not to be named).

The board of directors is more than a set of advisors to company management — they represent the shareholders of a company and have a fiduciary duty to ensure that shareholders interests are served. They have the power to replace executives, and can be held liable if they don’t do their jobs. As seen in the case of Dyadic, boards of directors can exert great control over companies.

I’ve regularly give talks on managing unexpected risks, and I’d love to find more examples of boards of directors actions leading companies astray — does anyone have any leads?