Inside and Outside Directors

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“The boards of most publicly owned corporations are composed of both inside and outside directors.  Inside directors are typically officers or executives employed by the corporation.  Outside directors may be executives of other firms but are not employees of the board’s corporation.” (Wheelen, Hunger, Bamford, & Hoffman, (2015), p. 46).  The text discusses the various points of view between having inside or outside directors.  An argument can be made to support outside and inside directors, with the positives for one being the negatives for the other.  My organization follows this trend having both inside and outside directors.  Several of the outside directors have brought with them business, that has increased my companies market share.  One of the clients we have gained was actually a client we lost due to not meeting customer expectations, however this board members relationship with the client has us back doing business.  From what I’ve seen outside boards members often bring with them business connections that may prove vital to company expansion.  Inside board members may be to immersed in the corporation to see the bigger picture or identify areas of necessary change.  Class, which would you support to run your corporation? 

Outside Directors  InsideDirectors

Pros: less biased, objective and critical   Pros: personal interest in company success

Cons:  no vested interest  Cons: Not able to make objective decisions

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