Watching the watchers: Vanguard's lead director

Readers of the new "Commonsense Corporate Governance Principles" for "America's public corporations and financial markets," as endorsed by JPMorgan boss Jamie Dimon, GE's Jeff Immelt, Vanguard Group's Bill McNabb, BlackRock's Larry Fink and other corporate masters, quickly noticed many of the signers are both board Chairman and also Chief Executive Officer -- even though the guidelines discourage doubling those jobs, and point out that "every board needs a strong leader who is independent of mangement."  

When independent directors don't agree they need a Chairman of their own, they should at least set up  "a strong lead independent director with clearly defined authorities and responsibilities," the guidelines add.

Malvern-based Vanguard's McNabb is among the leaders who hold both management and board supremacy. Vanguard is a private company, owned by its funds, controlled by its board and management. So "the Vanguard fund board appoints a lead independent director to coordinate the activities of the independent directors, chair all meetings of the independent directors and oversee the board's agenda," and also chair each board committee, says Vanguard spokesman John S. Woerth.

The identity of that lead director isn't posted on Vanguard's online board list. He is currently Mark Loughridge, retired CFO at IBM and director of Dow Chemical, which is about to combine with Wilmington-based DuPont Co., and a Vanguard director since 2012, Woerth told me, since I asked.

Thomas O'Brien, 79-year-old onetime chairman and CEO of PNC, the largest Pennsylvania-based bank, serves as lead director at publicly-traded BlackRock, one of the few U.S. investment firms larger than Vanguard. His role is listed on BlackRock's Web site.

As Independent Lead Director, Vanguard's Loughridge succeeded Al Rankin, longtime boss at Ohio-based holding company NACCO Industries, who served as Vanguard's Lead Independent Director from 2006-14, Woerth added.  

The "authorities and responsibilities" of the trustees, Woerth told me, are listed in Vanguard's fund prospectus, Part B: