AICBA Back Story
“In looking for people to hire, you look for three qualities: integrity, intelligence, and energy. And if they don’t have the first, the other two will kill you.”
— Warren Buffet
Background: Why the Institute Exists
Kodak, General Motors, Chesapeake Energy, Merrill Lynch, Lehman Brothers, Fannie Mae, Bear Sterns, Countrywide, AIG, Washington Mutual, Kmart, Chrysler, Tyco, Adelphia, Enron, WorldCom, Global Crossings, RJR Nabisco, Orange County California, the S&L Crisis, Penn Central and on and on through time.
The list of major and minor enterprises, public and privately owned, that has had to deal with incompetence, mismanagement, malfeasance and downright lawlessness is endless. Their march across human history is timeless. They have endangered individual nations as well as the entire global economic system.
The loss of shareholder value, damage to our economy and material injury to all stakeholders because of the melt-down of American enterprises due to serious, non-routine business irregularities and gross strategic decision-making negligence must stop.
Outside auditing, internal compliance, professional standards, government regulations and laws as well as the best of cultural ethical standards have not been and will not be enough to ensure strategic level business integrity.
In 2012, a group of professionals with experience in industry, the professions and government came together to consider the issues surrounding the failure of important American enterprises. Each member of that informal think-tank effort had direct, hands-on exposure to the weaknesses of corporate directorship and executive leadership. From this informal beginning, the Center for Strategic Business Integrity was born.
We recognize that competitive change is driving all companies at a breathtaking rate. In this intense environment, we believe that the most important line of defense – the best strategy – against corporate corruption, abuse of executive power and gross negligence is the direct, active and competent oversight provided by the board of directors.
Our nation’s current economic scale, complexity and interconnectedness means that the American enterprise has outgrown the traditional culture and strategies of corporate governance. This core factor coupled with numerous international, economic and technological challenges leaves the traditional strategies and tools of corporate monitoring vulnerable to material negligence and irregularities. The American corporation employs many governance practices that are outdated and ineffective in the modern, globalized marketplace.
To address these obvious governance and leadership vulnerabilities, and help drive the development of successful global businesses, the corporate directorship role and its supporting oversight advisory services must undergo a serious and urgent adjustment.
The American Institute for Certified Board Advisors believe that the American corporation must substantially upgrade the design and quality of its decision making and governance culture. We must better deter, detect, respond and effectively resolve material corporate negligence, irregularities & corruption before the damage is done.