Sunday, September 01, 2002

Strategy and Corporate Governance -- Part I

Since last fall, I have been at the University of Wisconsin, working with a group called the Initiative for Studies in Technology Entrepreneurship (INSITE). They have quickly become some of my favorite people, and I am learning a lot about entrepreneurship.

Last week, Anne Miner, Mason Carpenter, and I met with representatives of the State of Wisconsin Investment Board (SWIB) to discuss their upcoming Directors' Summit. Mason and I will be doing a panel entitled, "Governance practices as strategic assets." Or something like that.

The main focus of the panel will be the relationship between corporate governance and corporate strategy. With all of the talk about monitoring in the wake of Enron, Worldcom, etc., we may have lost sight of the relationship between corporate governance and corporate strategy. My first paper as an academic was a study Kmart's decision to fire its then-CEO Joseph Antonini. While I am not sure that I still agree with everything I wrote there, I still think that shareholders should have a limited role in determining corporate strategy. I am afraid that all of the efforts to improve monitoring will result in more opportunities for shareholder mischief. And that would be a shame.