Such is the case with the iconic business duos presented here. These eight famous pairings—one of them infamous for its failure in the final act—present a spectrum of the unique qualities and dynamic teamwork necessary for the effective management of extremely innovative, complex organizations. A variety of top-tier combinations reveal several variations on the theme that two heads are better than one: some, like Richard Sears and Julius Rosenwald, were marriages of necessity; others, such as Sanjay Jha and Greg Brown, co-CEOs of Motorola, were partnered in hopes of salvaging an ailing organization; still others, like Warren Buffett and Charlie Munger, seemed fated to cohabitate in the same corporate host.

The delicate balance required for a successful top-level tandem power structure is no easy achievement, as evidenced by a string of dissolutions; keeping two big personalities in harmony requires a set of unique personality traits on both sides. “It all depends on how they behave and if they can keep their egos in check,” says Harvard Business School Professor Joseph Bower, author of The CEO Within. “It works remarkably well if you also have strong board members who are able to make it work.” The challenge, as Bower sees it, is living up to the age-old adage of “diversity in counsel, unity in command”: however many leaders a company has, it has to move forward decisively. But while having a single visionary at the helm is often just what a company requires, the breadth of experience and wisdom offered by a pair of equally guided leaders can also have its advantages. “As long as there is cooperation, a pair will bring greater assets than can come from one person’s intellect,” adds Bower.

“Whether we’re talking about socks or stocks, I like buying quality merchandise when it is marked down.”  – Warren Buffett, chairman and CEO, Berkshire Hathaway

Today’s activist shareholders urge boards and CEOs to seek a second opinion or appoint a devil’s advocate that can result in what some believe is a bifurcated structure, as evidenced by the recent push for splitting the roles of CEO and chairman. One of the common arguments for not splitting the roles is that it creates confusion about exactly who is in charge. Another is that it hinders the company’s leadership to communicate with one, clear voice. Yet another is that the two get in each other’s way, one reining in the other, forcing a compromised and dulled strategy. However, great business duos learn to sidestep these traps and work together for the greater good of the organization. They improve each other’s ideas without watering them down. They move in concert without stepping on each other’s toes.

The question of what is the optimal executive leadership structure is one the board must answer and be answerable for (though many of the following examples took place before the boardroom had the significance it has today); a director could not find a better starting place from which to view the issue than by looking at the following examples of tandem business success.

“Communication is the cornerstone,” says Belmont University Prof. Jeff Cornwall, who studies business organizational structure. “Successful partners are able to feel comfortable tackling difficult issues without being afraid of hurting each other’s feelings.” Certainly, when addressing high-impact challenges on a day-to-day basis, the best pairings have had a tendency to avoid sugarcoating the issues at hand, and a no-nonsense approach is also required. Says Cornwall, “Partners must have a similar work ethic, and they should have similar values, but not necessarily similar personalities.” Such advice, along with the examples offered below, affirms John Rockefeller’s maxim that friendship founded on business is preferable to business based on friendship. With such an appropriately sober attitude in mind—and with the implicit advice offered by history’s great duos—one should move confidently in building a capable leadership team.

Warren Buffett and Charlie Munger: Berkshire Hathaway
The partnership between Warren Buffett and Charlie Munger has been well documented throughout the pair’s 50-year professional relationship, but for traders, investors, and general profit-seekers at large, their formula for success remains elusive. In their leading roles at Berkshire Hathaway, the two have led investors (and themselves) to steady returns virtually unparalleled in the investment community. Their methods, as the two attest, are deceptively simple, yet their successes have been without peer.

Buffett and Munger are unified in their ability to generate profit for investors in their funds, and the two men share similar investing values that revolve around the simple tactic of targeting undervalued assets and obtaining them. As Chairman and CEO Buffett put it in last year’s letter to shareholders, “Whether we’re talking about socks or stocks, I like buying quality merchandise when it is marked down.” However, the individuals behind Berkshire’s success have demonstrated their unique characters, even as they have waged a common investment crusade. Buffett, with his tireless, common-sense approach to investing, his emphasis on wise governance, and his seemingly infinite humor and wisdom, is the prototype for would-be fund kings. His annual shareholder letters offer up world-class insight into the methods by which steady returns are generated, all tinged with the folksy warmth that is no small part of the man’s appeal.

Many TARP recipients are now scrambling to pay back their share of the $700 billion bailout to escape further government meddling. Some banks are believed to be under an undisclosed regulatory sanction that requires them to revamp their boards and focus on risk and liquidity management. Since Bank of America signed on to TARP, four directors have resigned from its board and been replaced, likely with government input.

Recently, Citigroup reshuffled its senior executives, including the removal of CFO Edward Kelly—changes made while under pressure from the Treasury and after discussions between regulators and Citigroup Chairman Richard Parsons. Citi’s chief accountant, John Gerspach, is now the bank’s fifth CFO in five years. Citi also replaced four members of its board since signing on to TARP. Only three of AIG’s original 11-member board remain in place.

“You can at least see an attempt to make government regulators happier,” reflects Jaidev Iyer, managing director of the Global Association of Risk Professionals. “But there is a difference between making changes to appease regulators and making fundamental changes to your board and governance practices.”

“The government is working behind the scenes—but they will get their money back,” assures Simmons, who believes many of the casualties of the financial crisis will need to revamp their boards whether the government says to or not. Says Simmons: “The market is going to demand it.”

Chrysler named five new directors to its board: George F. J. Gosbee, chairman and president of Tristone Capital; Douglas Steenland, former CEO of Northwest Airlines; Scott Stuart, a founding partner of Sageview Capital; Ronald L. Thompson, chairman of the board of trustees for Teachers Insurance and Annuity Association; and Stephen Wolf, chairman of R.R. Donnelley & Sons.

American International Group’s annual meeting resulted in the re-election of Dennis Dammerman, former vice chairman of the board of General Electric; George Miles, CEO of WQED Multimedia; Suzanne Nora Johnson, former vice chairman of Goldman Sachs; and Morris Offit, chairman of Offit Capital Advisors. Liddy said he will step down as CEO as soon as a replacement is found.

Ken C. Hicks has been named Foot Locker’s new CEO. Hicks will succeed Matthew D. Serra, who has been the company’s CEO since March 2001. Serra will continue as the company’s chairman until his planned retirement next year.

Trex Company named Richard E. Posey to its board. Posey has served as chief executive of Moen Inc., a faucet manufacturer, and Hamilton Beach/Proctor Silex.

Bank of America revamped its board by electing four new directors: Susan Bies, William Boardman, Paul Jones, and Donald Powell. Bies previously served on the SEC’s advisory committee. Boardman served as chairman of Visa International until his retirement in 2005. Jones is currently an attorney at law firm Balch & Bingham. Powell is a director of Stone Energy.

Biogen Idec confirmed two of billionaire activist Carl Icahn’s picks to its board: Richard Mulligan, a professor of genetics at Harvard Medical School and director of the Harvard Gene Therapy Initiative; and Alex Denner, a managing director at Icahn Partners.

Jeff Huber, senior vice president of engineering at Google, has joined Electronic Arts’ board. Huber was in charge of technology development for Google’s AdWords and AdSense, as well as Google Apps. Prior to Google, he served in a number of management roles at eBay and Excite@Home.

David L. Calhoun has been named to Boeing’s board. Calhoun is CEO of The Nielsen Company. Prior to his work at Nielsen, Calhoun spent more than 25 years at General Electric.

Sonoa Systems named Tsvi Gal to its board. Gal is a general partner at Exigen Capital and previously served as Deutsche Bank’s Investment Bank and Assessment Management’s CTO.

Anne Egger has been appointed to Optical Sciences’ board. Egger has been working with Electro-Optic Sciences as a consultant since her retirement earlier this year.

Michael Gelmon and Cory Gelmon have been named to Safeguard Security Holdings’ board. Michael Gelmon has replaced Tom Montgomery as chairman of the firm and Cory Gelmon has been elected director and appointed new CFO.

Best Buy’s Brad Anderson will retire as the company’s CEO. Brian Dunn is believed to be Anderson’s successor. Dunn currently serves as the company’s president and COO.

E*Trade Financial named Kenneth C. Griffin, founder and CEO of Citadel Investment, to its board. Griffin currently sits on the Advisory Council for Chicago 2016, working to bring the 2016 Olympic Games to the Windy City.

George E. Minnich has been appointed to Kaman’s board. Minnich retired as senior vice president and CFO of ITT in 2007.

MarineMax appointed Russell J. Knittel to its board. Knittel has been executive vice president of Synaptics since 2007, and CFO  since 2001.

Ray Powers has been appointed to MediaG3’s board. He served as COO and executive vice president of International Communications, a wholesale carrier that owned nearly 460 wireless transmission sites in the U.S.

Robert Half International appointed Barbara J. Novogradac to its board. Novogradac is currently president of Novogradac Investment Company, a private real estate investment company.

FedEx elected Susan C. Schwab, U.S. Trade Representative from 2006 to 2009, to its board. Schwab is currently a professor at the University of Maryland’s School of Public Policy.

Qualys CEO Philippe Courtot has been elected to Tech-America’s board. Courtot served on the board of the Cyber Security Industry Alliance (CSIA). He previously was chairman and CEO of Signio, an electronic payment start-up that he repositioned to become a significant e-commerce player.

James K. Brewington has been named to Sonus Network’s board. Brewington retired as president of Developing Markets at Lucent Technologies in 2007.

Boston Scientific CEO James Tobin will leave the medical-device maker. Tobin will be succeeded by Raymond Elliott, the former CEO of orthopedics maker Zimmer Holdings.

ScanSafe, a provider of Software as a Service web security, appointed Bernard Liautaud to its board. Liautaud was founder and CEO of Business Objects, an enterprise software company.

John McCartney was elected to Covance’s board. McCartney currently serves as chairman of the board of A.M. Castle, a provider of products, services, and supply chain solutions. McCartney previously served as president and COO of U.S. Robotics.

George E. Minnich has been named to Kaman’s board. He retired as chief financial officer from ITT in 2007.

Given the federal response, the business law community was anxious to analyze the response of the Delaware Court of Chancery, the nation’s preeminent court for litigating business disputes. A review of the Court of Chancery’s recent decisions shows that it has not allowed the current political climate to influence its historically balanced approach. These decisions illustrate that the Court understands the role of corporate risk-taking with investment capital and will not automatically equate corporate losses with directorial or executive liability. At the same time, however, the Court will allow suits to proceed where plaintiffs plead factual allegations of corporate wrongdoing. Two recent decisions illustrate this balanced approach.

The first decision involved shareholder derivative litigation (filed on behalf of the company) against current and former directors of Citigroup, which received billions in government aid. In that case, the plaintiffs alleged that the directors breached their fiduciary duties by failing to properly: (1) monitor and manage risks associated with Citigroup’s exposure to the subprime lending market in the face of  “red flags”; and (2) publicly disclose Citigroup’s exposure to subprime assets. Based on these allegations, the plaintiffs sought to hold the Citigroup directors personally liable for alleged shareholder losses.

Despite Citigroup’s substantial losses, the Court of Chancery dismissed almost all of the claims in the lawsuit at the pleading stage for failure to make a “demand” on the board prior to bringing suit. The Court refused to engage in a substantive hindsight review of the business judgment that gave rise to the losses because, as was alleged in the complaint, Citigroup had policies, procedures, and controls in place designed to monitor risk. As the Court stated: “Citigroup was in the business of taking on and managing investment and other business risks. To impose oversight liability on directors for failure to monitor ‘excessive’ risk would involve courts in conducting hindsight evaluations of directors at the heart of the business judgment of directors. Oversight duties under Delaware law are not designed to subject directors, even expert directors, to personal liability for failure to predict the future and to properly evaluate business risk.”

In the second decision, involving AIG, now largely owned by the federal government, the shareholder plaintiffs alleged that AIG management secretly used offshore subsidiaries to mask losses and misstated the company’s financial performance in order to convince investors that AIG was more financially secure than it actually was. In denying motions to dismiss the complaint, the Court of Chancery found that the plaintiffs had alleged facts that, if ultimately proven true, would show “pervasive, diverse, and substantial financial fraud” involving senior managers at AIG. Because the plaintiffs pled facts that would support a conclusion that the former CEO and CFO, among other former senior executives at AIG, had “personal knowledge” of the widespread financial corruption and “direct involvement in a variety of allegedly improper transactions,” the Court permitted the case to proceed to discovery.

While the boundaries between these two cases are extreme, it is easy to see some lines of demarcation. Where plaintiffs allege a lack of effective oversight and risk management by directors, Delaware courts will look to determine if any oversight processes are in place to monitor risk. If risk management processes exist, then Delaware courts will not typically subject business decisions to an unfair hindsight analysis colored by the passage of time and the outcome, regardless of the efficacy or effectiveness of those processes. That is in contrast to cases where executives are credibly alleged to have engaged in, or acquiesced to, financial fraud. This balanced approach should continue to encourage the corporate risk-taking necessary to help the economy recover from the recent downturn, while at the same time provide an effective deterrent to wrongdoing. It should also continue to make Delaware the preeminent forum for incorporation and choice of law clauses in contracts.

The $100-million bonus is based on a contract with Citigroup, now operating under the aegis of the U.S. government. A New York Times story, written by David Segal, reports that  the situation raises thorny questions about “the hazards of mixing the public interest with capitalism at its most unbridled, and it raises basic questions of fairness.”

Hall is the 58-year-old head of Phibro, a commodities trading firm in Westport, Conn., and his “nine-figure payday” represent his share of profits from what the NYT described as “a characteristically aggressive year of bets in the oil market.” Hall’s contract is  is owed the money under a contract with Citigroup, and therein lies the rub. Since the bank was saved with roughly $45 billion in taxpayer aid, Obama administration compensation specialist, Kenneth R. Feinberg, will decide whether the trader gets what is owed to him.

A spokesman for Feinberg, Andrew Williams, responding to a NYT query via email, said the reviews of compensation  are just getting underway and that pay levels must strike the right balance between discouraging  excessive risk taking and encouraging reward. “We are not going to provide a running commentary on that process,” Williams wrote in the email, “but it’s clear that Mr. Feinberg has the broad authority to make sure that compensation at those firms strikes an appropriate balance.”

Citigroup’s co-head of global markets, James Forese, believes contracts such as Hall’s will live up to the administration’s intent. “We’re confident in the value these types of profit-sharing arrangements bring to the company and its shareholders as they directly align compensation with performance,” Forese wrote in an email.

[Feinberg will address the Boardroom Leaders Forum on November 16 in New York. For more information, click here.]

Judy Warner is deputy editor and editorial conference director at NACD Directorship magazine.