Who is Dell’s board working for?

March 11, 2013, 9:55 PM UTC

FORTUNE — Carl Icahn announced this morning that he has entered into a confidentiality agreement with Dell (DELL), which means he gets to play around in the data room with the The Blackstone Group (BX) and other potential bidders. The company’s special committee already told Icahn that if he wanted the company he should just make a bid — rather than agitating for a special dividend — so perhaps that’s what he’s considering.

I wrote about the special dividend proposal on Friday, from the (theoretical) point of view of Dell’s board. That prompted an insightful email from a public company director (not at Dell) who prefers to remain anonymous:

“The Icahn proposal for Dell is really interesting. It’s clearly better for current shareholders in the short term. It’s clearly a disaster for the next set of shareholders (whoever is going to buy shares from Icahn). It illustrates a conundrum faced by every public company board that never gets talked about — when acting in the best interest of shareholders, which shareholders are you talking about? Current shareholders with short term goals, current shareholders with long term goals, future shareholders (particularly relevant if your stock is held by activists and arbs), or the shareholders you are trying to attract (and wish you had)?”

I’ve been pondering that one all weekend, and remain flummoxed. My bias is that the responsibility is to current shareholders, but that obviously has its limits. For example, the best thing for current Dell shareholders may be company liquidation. And the limits work both ways, since the best thing for long-term shareholders would be for Dell’s current value to sink to $0.01 per share (so long as they can buy at that price, and then ride the stock back up).

So I reached out to Eleanor Bloxham, CEO of The Value Alliance, for her thoughts on this general subject. Her reply:

“The board is there to act in the best long term interests of the company and all its stakeholders. Boards are responsible for caring about the longevity and long-term health of the firm. Some of the confusion arises because of the statement shareholders own the company. But they don’t. They own shares in the company. And if the company goes belly up, what do long term shareholders have? Nothing. But even in the worst of circumstances, shareholders don’t take on the liabilities of a failing company. (In that sense, they don’t own those.)

Boards are there to represent the company and all stakeholder interests. (There are responsibilities to society, employees, suppliers, creditors and legal authorities.) They have to worry about those liabilities and responsibilities – and oversee for the longevity of the company and all its stakeholders.”

This need to navigate the needs of all stakeholders also was discussed recently by Ira Millstein in the The NY Times.

As for Dell, I get the sense that its special committee simply wants to get the best price it can right now and then bring it to a shareholder vote. If that price comes from Michael Dell and a private equity firm, so be it. If not, that’s okay by them too. That all seems to be valuing current shareholders above all else, assuming the special committee is correct that the special dividend could cause the company’s share price to call below $4.65 per share (which is a legitimate fear, particularly if Michael Dell were to quit).

But, in general, I’m interested in your thoughts. What interests should the board be putting above all others, and how does it split the various differences? Is there any way to get it “right?”

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