Zaxxone Oil Company, Inc., headquartered in Mobile, Alabama, isa multinational corporation with 2012 annual profits of $45billion. Zaxxone has 12 board members who serve the company on apart-time basis, with each board member receiving an average of$300,000 per year in compensation.

Emily Chanel, a pre-law student at the University of Alabama inMobile, is quite familiar with Zaxxone, and she has studied herbusiness law textbook material on corporations and their directors,officers, and shareholders very carefully. She recalls that a boardof directors and its members owe a strict fiduciary duty to thecorporation; as part of this fiduciary duty, the board mustexercise oversight in monitoring the actions of corporateemployees, including the executives and officers of thecorporation.

Chanel ponders, "How can board members of a major corporation betruly objective when they are being paid such lavish sums of money?Wouldn't Zaxxone board members have a 'don't rock the boat'mentality in terms of exercising their oversight function?”

"Why, for example, would a Zaxxone board member question thepractices of the company's high-ranking executives and officerswhen such an inquiry might jeopardize his or her $300,000 per yearannual compensation? Make no bones about it—if I were a boardmember at Zaxxone, I would probably be a 'yes-woman' and approve ofeverything the chief executive officer, the chief financialofficer, and the chief operating officer wanted to do!“

How would you respond to Chanel's questions and overall concernsabout board members' compensation and objectivity?