Nixon Medical’s majority-independent, fiduciary board was established in 1998. Through the efforts of the company’s former and current family shareholders, directors, managers and consultants, governance has continuously improved over the past 25 years.
The board was instrumental in the successful leadership and ownership succession from G1 to G2, executive team development, strategy oversight, crisis management and improved business performance. Nixon Medical’s board is modeled on best practices, including a majority-independent board, an independent chair, independent committees (audit, compensation, president evaluation), regular governance surveys and director assessments.
Governance practices borrow from public companies and are tailored to the needs of a private company. Directors are seasoned executives of larger companies with public company board experience.
The company’s intentional governance process was voluntarily started by its enthusiastic founder, Murray Berstein. In my experience, family business leaders are curious yet reticent to form an independent board. They may fear the worst and struggle to see the possibilities. From my vantage point, the avoidance of oversight is the loss of opportunity.
Murray formalized governance to gain perspective on his growing business. It was a great decision and a demonstration of courageous leadership. Since that time, the company has grown more than twelvefold.
While it is hard to recognize the company today compared with what it looked like 25 years ago, it is also hard to recognize the board. Everything has changed from the company’s early foray into corporate governance, including the director profile, meeting cadence and agenda.
In the early years, the board had a cross section of director specialists: the banker, the lawyer, the entrepreneur, etc. The formalized board started with around eight directors. Today, the shareholders look for directors who have been where the company wants to go. In general, they are, well, generalists and active CEOs of larger organizations.

The company currently has five independent directors. Meetings moved from six per year to four, and the agenda has changed dramatically.
The board is very conscious of who is responsible for what, and the company clearly delineates ownership, board and management responsibilities. The framework is codified in a chart that lists the responsibilities of various stakeholders. The family and board regularly review and respect the boundaries. The objective is to appropriately empower management.
Board duties include strategy approval and oversight, business performance review, executive compensation approval, CEO evaluation and succession. The shareholders and management are primarily responsible for other duties. The board is responsible for strategy approval and oversight, but management is responsible for strategy development and implementation. Also, while the board needs to approve executive compensation, the shareholders are responsible for board compensation.
Board books are distributed two weeks before meetings. The content is aligned with the company’s strategy and the balanced scorecard serves as the centerpiece. For each functional leader, the content is grounded in their performance trend, learnings over the past quarter and a forward-looking plan to positively impact results.
The company has wonderful directors. They ask tough questions for the right reasons. The board’s chair and directors have worked hard to get the balance right in regard to oversight and insight (as well as challenge and support for management and the family shareholders). For example, the board asks the shareholders to regularly review and update their goals for the business. Every meeting begins with a family and board executive session, during which the directors ask the shareholders questions about their expectations and vision for the business. This topic is intended to provide the directors with a better understanding of shareholder objectives so they can represent their interests.
Strategy is a key area where the board has pushed management to go deep. The board challenges management to think through the strategy, with questions like:

(Credit to Ellen Cooper.)
- How are you going to win?
- How are you going to get there?
- What capabilities do you need to build for the future?
- How will you objectively measure how you are executing against each strategic pillar?
The evolution of the board has had an immeasurable impact on me and the leadership team. With that said, great governance cannot be achieved without great management. The management team is where the hard work is done and where the payback on great governance is realized.
In 2014, the family shareholders faced a difficult decision. Murray was transitioning his remaining leadership responsibility and stepping down as chair of the board. My brothers and I saw two options. I could assume the responsibility of chair or we could nominate an independent director to serve in the role. After discussion and consideration of the pros and cons, the shareholders decided to work toward nominating an independent director to become the next chairperson. Murray’s example of forming an independent board pointed us in the right direction.
The family decided that working toward an independent chair was best for the leadership team, the business and the shareholders. Since selecting an independent chairperson, the company has grown revenues fivefold.
Shortly after Murray graduated from the business, my brothers and I commissioned a portrait. Ben, Dan and I wanted to recognize Murray’s lasting contributions to the business, including to Nixon Medical’s board. Fittingly, the portrait hangs in the company’s boardroom.