Public companies are facing many issues, often technical in nature. Their boards of directors are striving to keep up with challenges ranging from cyber risk to a wide assortment of other business and enterprise risks, including increased global competition, climate change impacts, pressures from activist shareholders, enhanced bribery and anti-corruption regulations, and tests to business models posed by new technologies and innovation.
In response to the specific concern that company boards may not have the technical expertise to oversee their management’s cybersecurity efforts, some Congressional leaders have concluded that the concern should be addressed through “expert-ization” of the board. A bill introduced in the Senate last winter would require publicly traded companies to disclose whether any members of their boards of directors are cybersecurity experts, and, if they are not, to report on the steps they are taking to identify and evaluate the cybersecurity expertise of their directors.
In this opinion piece for CFO Magazine, RK&O partner Michael D. Mann outlines why this idea is actually a threat to good corporate governance and has the potential to weaken the functioning of company boards.