Private Company Governance Summit 2014 report

The conference addressed boardroom nuts and bolts.

Best board practices were the focus of the second annual Private Company Governance Summit, presented jointly by Family Business and Directors & Boards magazines and held at the Dupont Circle Hotel in Washington, D.C., May 7-9. The conference drew about 150 participants, including owners and directors of family and other closely held businesses, stakeholders in private equity-owned companies, and advisers to privately owned businesses.

The summit opened on Wednesday, May 7, with a discussion session entitled "The Effective Private Board." Steven J. Lytle, former chairman of Columbia Distributing and a director of The Agnew Company, a family business holding company; Jim Datin, CEO of BioAgilytix Labs Inc.; and Stan Silverman, lead director of Drummond Scientific, a director of Femco Holdings LLC and Exocor Inc., and former president and CEO of PQ Corporation, discussed the key traits of successful boards and best practices for private boards. Steve McClure, Ph.D., principal consultant of the Family Business Consulting Group, led the conversation. A networking reception and buffet dinner followed.

A full day of conference events on Thursday, May 8, began with brief remarks by Bob Kueppers, deputy CEO and vice chairman of Deloitte PPL, on "The State of Private Company Governance." Following Kueppers's talk, Directors & Boards editor-in-chief Jim Kristie conducted a keynote interview with Roderick Hills, former chairman of the Securities and Exchange Commission, who offered words of wisdom on the qualities of a good director and the corporate/government dynamic.

"Best Practices for the Successful Private Board Meeting" was the subject of a panel discussion moderated by Dennis Cagan, a director of Copper Mobile Inc., Acorn Technologies Inc., Truston, HeartStories Inc., and New Law Technology Inc. Panelists were Leigh J. Abrams, chairman of the board at Drew Industries Inc.; Cynthia Watts, a director at Furst-McNess Company; and Jim McHugh, a director at Southworth International Group Inc. and Kennebec Technologies Inc. They spoke about board basics such as agendas, briefing materials, length of meetings and procedural issues.

A panel conversation on "Governance for Family-Controlled Companies" was facilitated by Family Business editor-in-chief Barbara Spector. Lansing Crane, former chairman and CEO at Crane & Co. and chairman of SOG Specialty Knives & Tools, Canal Insurance Co. and Wells' Enterprises; Anne Eiting Klamar, M.D., president and CEO of Midmark Corporation; and Joshua Nacht, a director of Bird Technologies, discussed how good governance can help a family company succeed in today's global marketplace.

The luncheon keynote speaker was Marcy Syms, former chair and CEO of Syms Corp. She shared the story of her family company, which went public, acquired Filene's Basement, filed for bankruptcy and closed its retail stores in 2011.

Breakout sessions

After lunch on Thursday, attendees divided into smaller groups for breakout sessions featuring a director speaker and a moderated discussion. Bob Holland, a director of YUM! Brands and Carver Bancorp, and Jennifer M. Riley of Chubb led a session on "Private Company Director Liability." Dennis Cagan, a director of Copper Mobile Inc., Acorn Technologies Inc., Truston, HeartStories Inc. and New Law Technology Inc.; and F. Douglas Raymond III of Drinker Biddle & Reath LLP led a session entitled "Mentoring the CEO." A session focusing on "How to Keep Directors Independent" was facilitated by Stan Silverman, lead director of Drummond Scientific, a director of Femco Holdings LLC and Exocor Inc., and former president and CEO of PQ Corporation; along with Steve Alogna of Deloitte.

Bernard H. Tenenbaum, managing partner of Lodestone Global and an advisory board member at Diesco and Woldenberg Group; and Michael Flagg of Heidrick & Struggles were the moderators for a breakout on "Director Recruiting." Deborah Hicks Midanek, CEO and chairman of Solon Group Inc. and an advisory board member at The Biltmore Companies, and Chris Ruggeri of Deloitte facilitated a session addressing the question, "Is Your Private Company Board M&A Ready?" A breakout focusing on "Private Board Risk Oversight and Management" was led by Gary Sutton, a director of Procuro, AgileNano, Social Fabric and LightSource Renewables; along with Deloitte's Maureen Bujno. Margaret Pederson, a director of Viad, Xamax Industries and TextureMedia; and Eric Pillmore of Deloitte moderated the "Board Strategy" breakout session.

The day's final panel zeroed in on the topic of "The Use and Value of Advisory Boards." Moderator F. Douglas Raymond III, a partner at Drinker Biddle & Reath LLP, joined with Jack Ouellette, executive chairman of American Textile Company; Darcy A. Howe, a director of Heatron and a member of The Bama Companies' advisory board; Harold L. Yoh III, chairman and CEO of Day & Zimmermann; and Susan Stautberg, president of PartnerCom and co-founder of WomenCorporateDirectors; to discuss how private companies can develop an advisory (as opposed to fiduciary) board and leverage the board members' advice.

Thursday ended with a group dinner at the nearby Smith & Wollensky Steakhouse, where attendees had an opportunity to network and discuss the day's events.

Goal: 'To thrive forever'

Friday, May 9, began with a keynote address by B. Joseph White, president emeritus of the University of Illinois and a director of Gordon Food Service. White offered his advice on creating "boards that excel." His suggestions were based on his experience at Gordon Food Service, where Gordon family members enlisted him to help them develop "governance that will enable us to thrive forever."

After White's talk, Jeffry Powell, executive vice president of Diligent Board Member Services, moderated a panel on "Committees for Private Company Boards," featuring panelists Bob Holland, a director of YUM! Brands and Carver Bancorp Inc.; Deborah Hicks Midanek, chairman and CEO of Solon Group and an advisory board member at The Biltmore Companies; and the Hon. Edward A. Powell, retired president and CEO, USO World Headquarters, and a director of AnswerMedia LLC.

The conference ended with a panel conversation on "Private Board Composition, Evaluation and Compensation," facilitated by John Wood, vice chairman of Heidrick & Struggles. Panelists were Edward J. Smith, president of Barnegat Bay Capital Inc.; Bernard H. Tenenbaum, managing partner of Lodestone Global and an advisory board member at Diesco and Woldenberg Group; and Gary Sutton, a director of Procuro, AgileNano, Social Fabric and LightSource Renewables. They spoke about director skills and experience, diversity, recruiting of board members and director compensation.

The Private Company Governance Summit 2014's premier sponsor was Deloitte. Gold sponsors were Heidrick and Struggles and Diligent. Silver sponsors were Chubb, Drinker Biddle & Reath LLP and the Family Business Consulting Group.

Copyright 2014 by Family Business Magazine. This article may not be posted online or reproduced in any form, including photocopy, without permission from the publisher. For reprint information, contact bwenger@familybusinessmagazine.com    

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July/August 2014

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