In Search of Director Independence

This story is part of a special series by TheStreet.com investigating shareholders' reaction to corporate corruption on Wall Street. Click here to see a full listing of stories.

There's no question, directors were part of the problem at Enron, WorldCom, Global Crossing and many other companies now charged with fraud and deception.

Can they also be part of the solution? Corporate reformers agree that any effective effort to restore investor confidence will require better oversight from directors. But the first batch of proposed reforms, most notably the new listing standards from the New York Stock Exchange, have significant shortcomings, according to shareholder rights activists and corporate governance experts. Among the most vexing issues:

How can directors be truly independent from the companies they serve? And does independence ensure competence?

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