Directors must increase shareholder value. That is the law in almost all instances; the variables are timing and selection of method. Activist shareholders are likely to be the major watchdog over adherence to this obligation.
Trump pushes for domestic siting of facilities and, presumably, sourcing of components. US labor and other costs are high. Products will cost more to produce. Such products may be at competitive disadvantage. Trump cannot directly force the company to select US vs foreign growth.
What do directors do? What policy postures should a board discuss with, or insist upon for, the CEO? Trump’s unorthodox, direct approach already has impacted some corporate actions, and drawn philosophical criticism from many, including on the editorial page of the Wall Street Journal.
Boards, as the strategic leaders of a company, need to engage these issues now. What guidance can they find? Aside from knowing their industry and company, and aside from prodding management to engage these issues (though hard to believe management is not self-motivated), what outside resources are available to define the methodology of board actions? How does the board approach its minutes in this circumstance? The answers to these latter questions will evolve promptly in the marketplace; even now, one day after inauguration, the National Association of Corporate Directors has proposed some guidelines for Board process.