Being a director is an honor and a responsibility. An honor because it recognizes the individual’s business accomplishment and the value he or she can bring to an organization in providing oversight. Directors also take on a heavy responsibility to use their judgment to serve the interests of shareholders.
“When you join a board, you put your reputation on the line,” said Craig J. Duchossois, CEO of the Duchossois Group, a privately held company. “Do your due diligence on the company. Does the company share your values? Talk to management, other board members, employees, customers and the community.” He made his remarks in a panel on Private Company Boards at a Chicago NACD meeting.
When Duchossois was asked how he did his due diligence, he turned to his newest board member in the audience, Donna Zarcone, “why don’t you tell us, Donna.”
“We did due diligence on each other,” said Zarcone. “You have to. It’s so important. With a private company, you want to look at everything that’s available in the public realm. Then, you need to do a lot of private checking, with other board members, with management, employees, customers, the community. ”
“Don’t be shy about asking management for what you need to make a decision,” added Michelle Collins, an advisory board member of Svoboda, Collins LLC, a private equity firm. “It’s a great test of how the CEO treats his board members.”