Fri 22 Oct 2004
The Wall Street Journal provides this update ($ req.) on the scandal at Marsh. Eph readers will be most interested in these sections.
The company’s 10 outside directors met on and off yesterday about aspects of the crisis, including Mr. Greenberg’s fate, people familiar with the matter said. The meetings followed the talks between some outside directors and New York Attorney General Eliot Spitzer, who sued Marsh last week and signaled his desire for Mr. Greenberg’s ouster. At the time, Mr. Spitzer publicly said Marsh directors “should think long and hard, very long and hard, about the leadership of your company.”
And here I thought that Morty was thinking long and hard about how to make Williams better. Silly me.
Several of Marsh’s outside directors have impressive credentials. The board includes Zachary Carter, a white-collar-crime defense attorney who was U.S. attorney in Brooklyn, N.Y., during the Clinton administration; Robert F. Erburu, former chairman of Times Mirror Co.; Lord Lang of Monkton, a former member of the British Parliament; and Morton O. Schapiro, president of Williams College.
Nice to see Morty included in this list. Again, I suspect that Erburu was the person who got Morty the job. Of course, whoever got Morty the job did not care at all that Morty has no background in business nor any expertise in any of the businesses that Marsh operates in (insurance, investment management and consulting). So, why did they pick Morty? I don’t know. Where is the Record when we need it?
The Marsh board gets low marks from corporate watchdogs who track board governance. Corporate Library grades the Marsh board a “D” on a scale of A to F, meaning it ranks below 80% of the roughly 2,000 boards that Corporate Library studies. Institutional Shareholder Services ranks the Marsh board in the bottom 2% of the companies in the Standard & Poor’s 500. Governance Metrics International also gives Marsh’s board a below-average rating.
Note that Morty is on the Directors & Governance subcommittee of the board. In other words, to the extent that you think that the Marsh board is weak, you should assign Morty a fair portion of the blame. I am not sure how much faith to put in these sorts of measures.
I am still thinking through how I feel about board jobs for Williams faculty members like Schapiro and Roseman. But, there can be no denying the fact that Morty is spending a ton of time on this right now. Fortunately(!), he is well-compensated for it.
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