Public Directors and TARP Boards

I read with considerable interest Robert Reich’s excellent article, “We Need Public Directors on TARP Bank Boards” (April 25). If taxpayers are providing funds to these institutions, via the mandate of the federal government, then the public should have well-informed and well-guided members who represent their interests on these boards.

I would suggest that the federal government turn to the states and national health-care credentialing organizations for models of how public or “consumer” members on a board can very effectively represent the interests of the citizenry, yet still perform all of the fiduciary and standard of care duties which are typically required of a corporate board member.

For years, many state medical licensing boards and national health-care certification organizations have very effectively utilized public or “consumer” members to represent the interests of the general public who are affected by the actions of these agencies, and yet still perform all of the duties typically required of a board member. This is no easy task. Serving two masters, without slighting one, never is. But, with proper guidelines and a good framework for how a public member should operate on a financial institution’s board of directors, it can be done — and, it can be done well.

Paul A. Dillon
Chicago

My original submission is as follows: