Image by Reindert from Pixabay

In 1729, the great satirist, Jonathan Swift, penned an essay called “A Modest Proposal.”  The essay suggested that rather than allowing poor, starving children to be a burden on society, they should be fattened up and eaten.

How does this relate to corporate governance, you ask?  Well, here goes.  Anyone who has ever had children or spent any time around children knows that at some point most rug rats become incessant and indefatigable interrogators, their favorite question being “why?”  “Why do I have to eat vegetables?” [Because they’re good for you.] “Why?” [Because if you don’t eat vegetables you won’t grow to be big and strong] “Why?” [Because vegetables have vitamins and minerals that you need] “Why?”  And so on.  These wee tads are never satisfied with any answers, regardless of their logic or compelling authority; thus, responses like “Because I’m your father and I make the rules” go unheeded.  The “whys” just keep on coming, ad nauseam (literally).

I was reminded of this when I read a Wall Street Journal article (subscription required) reporting on a lawsuit alleging that Boeing’s board members failed to challenge its CEO as to the safety of the 737 Max.

Disclaimer:  Without disregarding the tragedy of the 737 Max disasters, this kind of thing is typical in litigation – throw all sorts of pasta up against the wall and see if some of it sticks – and it’s no surprise that some of the pasta alleges dereliction of the directors’ fiduciary duties in an effort to add as many defendants as possible.  Also, it’s no secret that lawsuits and the media almost always blame everything on the board.  “Where was the board?” is shouted in righteous indignation, as if the board is responsible for everything down to and including making sure the bolts on the engine mounts were sufficiently tight.  And who knows if this allegation will be supported by the facts, assuming the case isn’t dismissed or settled first.

Still.  In my experience, it is not at all unusual for a board to circle the wagons.  Anyone who questions the company is disloyal (at best) or the enemy (at worst) and must be treated accordingly.  In other words, while the allegations of director complacency may be (and hopefully are) wrong in this case, that sort of thing can and does happen.  All too often, I suspect.

Which brings me back to my modest proposal.  If you believe, as I do, that one of the key jobs of a good director is to ask questions and to keep asking until satisfactory answers are provided, let’s put children on boards.  Just imagine – the CEO makes an impassioned speech about a topic, and little Tommy or Doreen (or these days, little Madison or Turner) pipes up and says “why?”  And the CEO says “Well, because….”  And the brat tyke says “Why?”  And so it goes.  Just don’t tell them they have to eat their vegetables.