Minow leads push for corporate reform
By Meg McSherry Breslin
Photo by Dan Dry
[Nell Minow]’s been up before every professional bully in the business, and she simply takes them on.”
—Robert A.G. Monks
The study of corporate governance was barely emerging in 1985 when Nell Minow—pregnant with her second child and looking for a part-time job—entered the field with modest ambitions.
“I really didn’t care too much what the job was. I just wanted it to be interesting, and I wanted to be on the side with the good guys,” says Minow, JD’77.
From that humble start, Minow has built a formidable career that changed the face of corporate America. She and her business partner, Robert A.G. Monks, have worked with shareholders to improve corporate boards and replace poor-performing CEOs, while helping those organizations focus on executive engagement and accountability. Lately Minow and Monks’ efforts are grabbing the attention of key decision-makers, in corporations and in government.
Minow met recently with a small group of experts to advise Treasury Secretary Timothy Geithner on concerns over soaring executive compensation. Her expertise in the field has few peers; Minow, 58, has written more than 200 articles and co-authored three books on securities law, shareholder rights, and the modern corporation, including the leading business school text. She has testified before Congress and advised on key legislation for reforming corporate governance.
Beyond her high-powered corporate work, Minow has cultivated a second role as film critic, writing reviews of movies for children and teens for a variety of venues, most recently in her “Movie Mom” blog at Beliefnet.com. Minow revels in her disparate roles, testifying before Congress one day, rushing to review Toy Story 3 the next.
Minow grew up in Glencoe, Ill. and married her high school sweetheart, David Apatoff, who was also her classmate at the Law School. The couple now lives outside Washington, D.C. Apatoff marvels at his wife’s success with both careers, and her ability to balance her personal and professional lives.
In the corporate governance field, Minow has faced a long, uphill climb. She’s even had to convince the most unlikely people of the critical nature of her work—including her own father, Newton Minow, the former chairman of the Federal Communications Commission and a senior counsel at the Chicago law firm Sidley & Austin.
The elder Minow ran afoul of his daughter’s long-running efforts to get corporate directors to take their jobs more seriously. While working with the Aon Corporation to strengthen its board, Nell Minow realized one of the directors—her father—had missed far too many board meetings. She didn’t hesitate to call him to task.
“She called me one day and said, ‘Dad, this is going to be one of the hardest conversations I’ve ever had with you,’” recalls Newt. “She said, ‘We advise our clients never to vote for anybody who hasn’t attended 75 percent of the meetings.’ I said, ‘You’ve got to be kidding me! I’m your father!’”
Newt Minow was voted in regardless that year, but he proudly claims he’s never missed a board meeting since. “And I believe what Nell is doing is correct,” he says. “Boards clearly are better today than what they were.”
Nell Minow and Monks now run The Corporate Library, an independent research firm. Working with clients to strengthen their companies, she and Monks have been credited with getting directors to take greater leadership roles and push out ineffective or unaccountable CEOs.
Minow’s professional success has earned her distinction in the field. Directorship magazine in 2007 named her one of the 20 most influential people in corporate governance. This year, the University of Chicago Alumni Association awarded her the Professional Achievement Award for her transformative work with corporations.
One of the most vexing problems she has faced is executive compensation, especially at some of the financial firms that faced ruin in the economic downturn. Minow has compared some of the worst financial executives to Marie Antoinette or the Roman emperor Nero. But she says she has no problem with big CEO salaries—so long as those salaries are tied to performance. That link was eroded at many financial institutions, she argues.
“Ultimately, the people who gave out subprime mortgages got paid based on the number of transactions they made, rather than the quality of those transactions,” Minow says. “It’s the same for the people with the derivatives, same with the ratings agencies. So everybody who failed at every single point along this continuum failed for the same reason. It’s really up to the shareholders to fix that, and the only way to fix that is to get rid of the directors who do a bad job.”
Monks says Minow uses her charm and intelligence to take on even the most powerful corporate leaders. “She’s been up before every professional bully in the business, and she simply takes them on,” he says.
Still, Minow and Monks say their work is about trying to hit a moving target—you fix one problem, another one emerges. Yet the challenge of that work is what makes things interesting, Minow explains.
“Just as eternal vigilance is the price of democracy, it’s also the price of capitalism,” she says. “You’ve got to be anticipating the next catastrophe rather than working to prevent the last one.”