Simon Leagreet, the Chairperson and CEO of L-EVA Industries, Inc., has long been the major power at L-EVA. A majority of the directors are concerned that while Mr. Leagreet has been responsible for the firm's earning above-average returns, he has been displaying a tendency toward personal extravagance at the firm's expense. In order to limit Mr. Leagreet's power, the Board of Directors plans to:

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Appointing another individual as the chairperson of the Board of Directors would be the best choice to limit Mr. Leagreet's power. This would create a checks and balances system and limit the CEO's ability to make decisions unilaterally. Additionally, the new chairperson could provide oversight to make sure that the firm's resources are being used responsibly. Electing an insider as the lead director may not provide the necessary level of independence to effectively curb Mr. Leagreet's extravagance. Requiring Mr. Leagreet to personally certify the firm's financial reports may not be enough to ensure that he is not spending company resources excessively. Reducing the size of the stock option package provided to Mr. Leagreet may not necessarily change his behavior and may also make it difficult to attract and retain top talent.