It is often assumed that bad corporate performance means a bad CEO.
The task of a board of directors is then simple: dismiss the executive. If it
fails to do so, the board is said to be indolent. We take a kinder approach
to observed board behaviour and point to the problems even well-intended
boards would encounter. They face the twin task of disciplining and screening
executives. To perform these tasks directors do not have detailed information
about executives behaviour, and only infrequently hav
