Record Copy WELLS FARGO DIRECTOR-MANAGEMENT DINNER EWL Remarks ST. FRANCIS YACHT CLUB - MARCH 15, 1971 Gentlemen: I am delighted to be here and have the privilege of speaking to you this evening. I would have been even more pleased if I'd been left free to choose the subject matter of my remarks but I fear that it is not in the nature of Ernie Arbuckle to leave matters like this to chance. From our long friendship he is well aware that, left uninstructed, I have a fondness for speaking of my company, my wife and children, or myself -- and not necessarily in that order. Because of his long experience as a Dean he enjoys handing out assignments and so he has suggested -- and I use the word loosely -- that I speak to you this evening about the role of directors and boards of directors in general and specifically about the steps taken recently to make the Wells Fargo board more effective. Two questions come to mind. What good are directors? What good are boards of directors? The answer to both questions is: "It all depends", and it all depends on a number of things. At one extreme there is a school of thought in some management circles that boards of directors are good for nothing. It makes the prima facie case that outside directors can't be too bright in the first place, or they wouldn't be willing, for the compensation involved, to assume the tre-mendous risks and responsibilities involved in serving as a director. It further assumes that the outside directors don't know the business, can't and won't spend enough time on it, can only confuse rather than contribute to the important decisions necessary for the effective operation of the enterprise.