Companies May Fail, but Directors Are in Demand

by Susanne Craig and Peter Lattman for The New York Times, September 15th, 2010.

For 16 years, Marshall A. Cohen served as a director of the American International Group, stepping down just months before the company’s near-collapse in 2008. Several months later, Mr. Cohen was again in demand, joining the board of Gleacher & Company, a New York investment bank.

Gleacher expanded its board last year to include not only Mr. Cohen but Henry S. Bienen, who served as a director of Bear Stearns from 2004 until its rescue by JPMorgan Chase in March 2008.

On the second anniversary of the Lehman Brothers bankruptcy, appointments like those of Mr. Cohen and Mr. Bienen highlight how the directors of the companies at the center of the financial crisis — A.I.G., Bear Stearns and Lehman itself — still play an active role in the governance of corporate America.

“In too many cases, the radioactivity of a board member of a collapsed company has a half life measured in milliseconds,” said John Gillespie, a longtime Wall Street investment banker and the co-author of “Money for Nothing” (Free Press), a recent book on corporate boards. (continue reading… )

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