Sophisticated, experienced, and effective directors and officers rarely join a public company unless that company has a platform of protection that they deem adequate. The platform in this case relates to personal and financial risk that may befall these directors and officers. The three factors we typically think of at Woodruff Sawyer as the pillars of that platform are good corporate governance, indemnification agreements, and directors and officers (D&O) insurance.
Source: The Ins and Outs of D&O Indemnification Agreements