Erland Kailbourne
About Erland E. Kailbourne
Erland E. Kailbourne, age 83, is an Independent Director of Rand Capital Corporation and has served on the Board since 1999; he is designated as an Audit Committee financial expert by the Board and has extensive banking leadership experience, including prior service as Chairman and CEO (New York Region) of Fleet National Bank and Chairman/CEO of Fleet Bank before its merger into Fleet National Bank . He maintained perfect Board and committee attendance in 2024 and 2023, and 100% in 2022, reflecting strong engagement; executive sessions of Independent Directors occurred at least twice in 2024 and 2023, with the Board Chair leading those sessions .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| Albany International, Inc. (NYSE: AIN) | Director; Chairman of the Board (two periods) | Director 1999–May 2024; Chairman 2020–Feb 2024; Chairman May 2008–Feb 2019 | Long-tenured board leadership; stepped down in 2024 |
| Fleet National Bank (subsidiary of Fleet Financial Group) | Chairman & CEO (New York Region) | Retired 1998 | Banking leadership across NY region |
| Fleet Bank (subsidiary of Fleet Financial Group) | Chairman & CEO | 1993–1997 | Led Fleet Bank prior to merger into Fleet National Bank |
| State University of New York (SUNY) | Vice Chairman | 1995–1999 | Public sector governance experience |
| Financial Institutions, Inc. / Five Star Bank | Director | 2006–2018 | Regional bank oversight experience |
External Roles
| Organization | Role | Status | Notes |
|---|---|---|---|
| REV LNG Holdings, LLC | Director | Current | Private company |
| REV LNG LLC | Director | Current | Private company |
| Allegany Co-op Insurance Company | Director | Current | Private insurer |
| Conemaugh Valley Insurance Company | Director | Current | Private insurer |
| United Frontier Mutual Insurance Company | Director | Current | Private insurer |
| The Thomas and Laura Moogan Foundation | Director | Current | Private foundation |
Board Governance
| Topic | 2022 | 2023 | 2024 |
|---|---|---|---|
| Audit Committee | Chair | Chair | Chair Jan 1–May 8; Member from May 9 (Chair transitioned to C. Jaroslawsky) |
| Governance & Nominating Committee | Member | Member | Member |
| Independence Status | Independent Director | Independent Director | Independent Director |
| Audit Committee Financial Expert | Yes | Yes | Yes |
| Attendance Rate | 100% attendance (Board/committees) | 100% attendance (Board/committees) | 100% attendance (Board/committees) |
| Executive Sessions (Independent Directors) | At least twice; chaired by Board Chair | At least twice; chaired by Board Chair | At least twice; chaired by Board Chair |
- Board Chair Robert M. Zak is independent and chaired executive sessions in 2024 and 2023 .
- Rand is a “controlled company” (East Asset Management ~64% ownership) and does not maintain a standing Compensation Committee; relevant functions are performed by the Governance & Nominating Committee .
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Annual Director Fee (Cash) | $35,000 (structure; increased effective Jan 1, 2023) | $50,000 (structure) | $50,000 (structure) |
| Audit Committee Chair Fee (Annual) | $2,500 | $2,500 | $2,500 |
| Governance & Nominating Chair Fee (Annual) | $1,000 | $1,000 | $1,000 |
| Board Chair Fee (Annual) | $10,000 | $10,000 | $10,000 |
| Meeting Attendance Fees | None | None | None |
| Travel/Out-of-Pocket Reimbursement | Yes (as incurred) | Yes | Yes |
| Director-Specific Cash Fees (Erland E. Kailbourne) | 2022 | 2023 | 2024 |
|---|---|---|---|
| Fees Earned or Paid in Cash | $37,500 | $52,500 | $52,500 |
Performance Compensation
| Item | 2022 | 2023 | 2024 |
|---|---|---|---|
| Equity Awards (RSUs/PSUs) | None; no director stock plan | None; no director stock plan | None; no director stock plan |
| Option Awards | None; no option plan for directors | None | None |
| Non-Equity Incentive Plan | None | None | None |
| Pension/SERP | None | None | None |
| Performance Metrics Tied to Pay | Not applicable (no variable pay) | Not applicable | Not applicable |
Other Directorships & Interlocks
| Company | Type | Role | Interlocks/Notes |
|---|---|---|---|
| Albany International, Inc. | Public | Director (1999–May 2024); Chairman 2020–Feb 2024; Chairman May 2008–Feb 2019 | No compensation committee interlocks disclosed; ended public directorship by May 2024 |
| Compensation Committee Interlocks | — | — | None in 2024/2023/2022 |
- East Asset Management (~64.2% in 2025; ~64.2% in 2024) is a controlling shareholder and has rights to designate two nominees to Rand’s Board; Kailbourne is not an East designee .
Expertise & Qualifications
- Audit Committee financial expert designation; extensive banking and financial management credentials .
- Long-tenured board leadership at a NYSE-listed industrial company (Albany International) with multiple chairmanship periods .
- Public sector governance (SUNY Vice Chair) and regional bank directorships (Financial Institutions, Inc./Five Star Bank) .
Equity Ownership
| Metric | 2023 (Record date: Mar 2, 2023) | 2024 (Record date: Mar 20, 2024) | 2025 (Record date: Mar 6, 2025) |
|---|---|---|---|
| Shares Beneficially Owned | 10,000 | 11,000 | 12,821 |
| Spouse’s Included Shares | 139 | 139 | 159 |
| Percent of Class | <1% (2,581,021 outstanding) | <1% (2,581,021 outstanding) | <1% (2,969,814 outstanding) |
| Dollar Range of Rand Equity | Over $100,000 | Over $100,000 | Over $100,000 |
| Hedging/Pledging/Margin Use | Hedging, derivatives, short sales prohibited; margin accounts only with CCO pre-approval; none requested |
Governance Assessment
-
Strengths
- Proven audit oversight and financial expertise; served as Audit Committee Chair through May 8, 2024 and as member thereafter; consistent 100% attendance, supporting board effectiveness and reliable oversight .
- Independent status affirmed; participates in regular independent director executive sessions chaired by an independent Board Chair, enhancing independent oversight of the external adviser and financial reporting .
- Personal ownership is meaningful (> $100k) with rising share count over time, and anti-hedging policy enhances alignment with shareholders; no pledging disclosed .
-
Structural Risks and Potential Conflicts (Board/Company context)
- Controlled company: East Asset Management holds ~64% and has contractual rights to designate two nominees; although governance functions appear robust, concentrated ownership can influence board dynamics and investor confidence .
- Externalization and related-party dynamics: Rand is externally advised by Rand Capital Management LLC (RCM), with significant advisory fees (2024 base management fee $1,212,160; capital gains fee $1,727,000; income-based fee $178,218; administration reimbursements $178,749), necessitating vigilant audit and governance oversight to mitigate allocation and advisory conflicts; Audit Committee and related-party policies are in place .
-
Process/Controls
- Audit Committee is fully independent; members meet Nasdaq and SEC requirements; confidential reporting procedures exist; annual auditor evaluation covers PCAOB reports, independence, fees, tenure since 2003 .
- Directors’ & Officers’ insurance in place (premium $49,300 for 2024–2025 period), supporting risk management .
Overall, Kailbourne’s independence, audit expertise, and engagement are positive signals for investor confidence; primary governance sensitivities stem from controlled ownership and the external advisory model, which are partially mitigated by committee independence, policies, and his oversight role .
Insider Trading Compliance
| Year | Section 16(a) Filing Status |
|---|---|
| 2022 | Timely; no delinquent filings reported |
| 2023 | Timely; no delinquent filings reported |
| 2024 | Timely; no delinquent filings reported |
Director Compensation Structure (Policy Snapshot)
| Component | Policy Details |
|---|---|
| Annual Director Retainer | $50,000 in 2024/2023; $35,000 in 2022 |
| Committee Chair Fees | Audit Chair $2,500; Governance & Nominating Chair $1,000 |
| Board Chair Fee | $10,000 |
| Meeting Fees | None; travel and out-of-pocket reimbursed |
| Equity/Options for Directors | None; no stock, option, non-equity incentive, or pension plans for directors |
Notes on Say-on-Pay and Compensation Committee
- Rand qualifies as a controlled company; it is exempt from maintaining a standing Compensation Committee and does not pay corporate compensation to executives due to externalization; applicable compensation functions are handled by the Governance & Nominating Committee .