The View

Binders of Bozos – a database of directors

Having failed to land a board seat in the name of diversity, the next best thing was a plan to match dubious companies and people without assets

PUBLISHED : Monday, 01 September, 2014, 9:47am
UPDATED : Tuesday, 02 September, 2014, 4:51am

There is a certain Hong Kong resident known to me who was once rather spiffy and bright but in the past decade has wasted away to bone and is slowly turning impossible shades of orange and purple.

He does not suffer from some exotic tropical condition. He suffers instead from a more commonly tragic disease yet has defied the odds by managing, despite a number of visits to intensive care, to remain among the living.

He is also, amazingly, among the employed. His bank account is regularly topped up with fees earned as an independent non-executive director (INED) on the board of a Hong Kong-listed company.

Which of courses raises a very important question - namely, how can I get one of these gigs?

While not quite as dissipated as this poor fellow, I'm likely just as bad at reading a balance sheet.

Plus, I understand that women make up only 11 per cent of board directors in Hong Kong, and "diversity" is the new hot buzzword.

So, earlier this year, I contacted an organisation dedicated to bumping up the number of females on local boards of directors to a hoped-for 30 per cent.

It turns out the ‘binders of women’ idea stopped with Mitt Romney

My hope was that they could just add me to the database being kept to match qualified women with companies looking to diversify their boards. Then I could just sit back and wait for the email offers to ping into my inbox.

Such was my naivety. It turns out the "binders of women" idea stopped with Mitt Romney in Massachusetts. This group's activities are mainly focused on giving speeches on the subject of why it would be good if more women were on boards.

Not one to be deterred, I showed up to one of those speeches, delivered at an American Chamber of Commerce women's networking event.

Surprisingly, the main jawboner at this event suggested to the women gathered that we might "start by volunteering", for instance, at a charity or a non-profit.

Volunteer? It was the prospect of remuneration that attracted me to this idea in the first place.

And surely there's enough low-hanging fruit for would-be competitors to pick off - boards packed largely with relatives, directors who never show up to meetings, directors encumbered with directorships on a dozen other companies and so on.

Still, these networking events are always useful. One of the attendees reminded me that if I were on the board of some company that did something dodgy, I could be held financially, if not criminally, liable for their actions.

"Even as an INED?" I gasped.

Yep. And the risks are rising. Just this year, Hong Kong fanged up its Companies Ordinance, with two extra adjectives added to the section describing directors' responsibilities.

It's true that in real life, prosecutions against directors are rare in Hong Kong, as elsewhere. Just look at the benchmark set on Wall Street.

Recently the United States has got around to fining several banks for behaviour that contributed to sparking the global financial crisis. But no executives or directors were made liable - current shareholders, basically, are paying those fines.

Still, the risk remains that investors sometimes sue. To paraphrase Groucho Marx, best not to join any company that would have me on their board. At least not for annual fees that run as low as HK$100,000.

So much for my director dreams. As a backup plan, at first I thought maybe I should just try to get one of those gigs where you go around giving speeches about how it would be a better world if more women were on boards.

Then I got a better idea.

Clearly there is a certain kind of Hong Kong company that would prefer directors whose grasp of financial details is a little fuzzy and who will back even the zaniest management decisions, like paying executives millions in bonuses after years of losses, or switching the core business from say, banquet catering to nanotech sheep cloning or some such.

Meanwhile, there are also lots of people in the world with no assets and thus nothing to lose if they get sued by shareholders or fined by regulators.

Why not help match these groups? I am calling my company Binders of Bozos, and my database opens today.