New energy is stirring in corporate boards. After years when accounting scandals and charges of inadequate governance put them on the defensive, they are looking to step up their engagement with core areas of corporate performance and value creation. The principal finding of a McKinsey Quarterly survey of more than 1,000 directors (see sidebar, "How the survey was done") is that having focused for a time on accounting-compliance issues, they are now determined to play an active role in setting the strategy, assessing the risks, developing the leaders, and monitoring the long-term health of their companies.

At one level, our survey underlines the way the US Sarbanes-Oxley Act is holding boards—not only in the United States, but also around the world—more responsible for meeting high standards in reporting and controlling the financial affairs of their companies. Yet the implications for governance are even more far reaching. To achieve as much involvement as directors say they want, they will have to use their time in meetings more effectively and develop a new understanding of their roles and responsibilities; otherwise, they will give management the...