Boards of directors represent the shareholders of publicly-traded companies, validating financial results, protecting their assets, and counseling the CEO. It's a demanding responsibility, requiring directors to learn as much as they can about a company so that their insights stand up alongside those of executives. That, at least, is the ideal; but is it anywhere close to being the reality? Sadly, no, argues veteran director and educator David R. Beatty. In a wide-ranging interview with two McKinsey authors, he describes where many boards are lacking; the importance of focusing on the 3Ts (talent, time and tone), and why adding the CFO to every board is an idea worth considering. In a sidebar, the merits of family-run firms' governance models are discussed.

Family-owned businesses perform poorly on most accepted 'best practices' of good corporate governance, from majority voting to independent chairs. Could it be possible that they have an important lesson to teach publicly-held companies? Yes, say the authors, who discuss their latest research, which indicates that family-owned businesses are not only outperforming publicly-held businesses over time, but they are also leading the way on perhaps the most important best practice of them all: long-term thinking.