Governance Arbitrage

This unique book is decidedly not just another tome on corporate governance. Instead, think of it as an investment thesis and memorandum with a radical prescription for driving performance and long-term shareholder value higher at public companies.

When a company has assets that are undervalued or underperforming, an opportunity exists to create value, in some cases materially. Public company boards are one such asset. The core of this value and performance gap is the public company governance model itself. Author Henry Wolfe provides a contrarian, in-depth analysis of the shortfalls of the current model, presenting for the first time a comprehensive look at the reasons for the sub-optimal performance of corporate boards.

The solution for maximizing the board as an asset lies in the development of a completely new governance model. Taking lessons from the governance of portfolio companies of the top private equity firms, and from personal experience, Wolfe presents a fundamentally different approach, the value maximization model, as a transformative model for public company boards. And the book goes further, providing a high-level roadmap for the implementation of this more robust governance model, resulting in a board that is populated with the right directors and led by a high-performance chairman, all of whom have specific track records and competencies to drive maximum long-term value.

Perceived and developed as a key value-producing asset of the company and directed by a clearly defined governing objective, the value maximization board is aggressively on the hunt for the optimum levers and initiatives to develop the full, long-term potential of the company and intensely engaged to ensure that it is realized.

Connecting the dots of underperformance and outperformance in a new and comprehensive way, this book reveals a groundbreaking model that is far more effective for creating accountability, achieving high performance and developing the full potential of the company over the long term. In fact, the shift to the value maximization model makes an arbitrage play possible---that is, a tangible gain in company performance and long-term shareholder value brought about by a more robust, high-performance board.

Henry D. Wolfe is a private investor who has been an active catalyst for the creation of substantial value for shareholders in a variety of industry situations, both public and private. He has been a frequent guest lecturer at Harvard University and is a Visiting Professor at York University in Toronto. Wolfe is a graduate of Clemson University, where he was a member of the Clemson rugby team and served as its captain. He and his wife live in Chicago.