Survey of Traditional, Mid-Cap and E-Commerce Company Boards

John P. Beavers
Partner, Bricker & Eckler LLP
September 2000

Are e-commerce companies governing themselves differently than traditional companies in order to be more responsive to the new economy? For purpose of this discussion, Counsel for Boards and Executives has conducted a survey of the board governance of randomly selected e-commerce companies, mid-capitalized companies and traditional economy companies. 1

Board size
E-Commerce 8.2
Mid-Cap 7.0
Traditional 12.5

Board independence (percentage of total directors)
E-Commerce 72%
Mid-Cap 44%
Traditional 88%

Number of meetings per year
E-Commerce 8.8
Mid-Cap 6.5
Traditional 8.1

Number of standing committees (including an executive committee)
E-Commerce 2.72
Mid-Cap 2.53
Traditional 4.04

Number of members and number of independents on audit committees
# of members # of independents
E-Commerce 2.8 2.6
Mid-Cap 2.5 2.0
Traditional 4.5 4.0

Number of members and number of independents on compensation committees
# of members # of independents
E-Commerce 3.0 2.8
Mid-Cap 2.5 2.3
Traditional 4.5 4.5

Composition, by background and experience, of members
Technology Traditional economy Investment banking or venture capital Academic
E-Commerce 55% 43% 24% 2%
Mid-Cap 10% 88% 5% 2%
Traditional 14% 84% 8% 8%

Footnotes

1. The survey is based upon proxy materials filed with the Securities and Exchange Commission or otherwise publicly available during the 12-month period ended August 31, 2000.

2. Less than 10 percent of our random sample of e-commerce companies had separate executive committees.

3. Over 90 percent of our random sample of mid-capitalized companies had separate executive committees.

4. Over 90 percent of our random sample of traditional companies had separate executive committees.

More Business and Strategic Planning articles ...