In early 2000, as they rode the wave of what would become the longest economic expansion in US history, America's chief executives could do little wrong. They were lauded by the media, highly rewarded by shareholders and largely left alone by regulators and lawmakers.

That era has long since passed, given a final kick into history by the collapse of Enron, the energy trader, last December. The 10-point plan outlined yesterday by President George W. Bush to improve corporate responsibility and protect shareholders is potentially less onerous than many in US business had feared. But it endorses the post-Enron view that America's corporate chieftains need reining in.

That view was first enunciated by Mr Bush in his State of the Union address in January, when he called for corporate America to be "held to the highest standards of conduct". Carolyn Kay Brancato, corporate governance expert at the Conference Board, a New York-based business research association, says the Enron collapse made many people think that companies and accountants were "fraudulent unless proved otherwise, rather than the other way around".

If adopted, Mr Bush's 10 points may go some way to redressing that balance by laying out standards that honest companies can adhere to. The proposals include a call for chief executives to vouch personally for "the veracity, timeliness and fairness" of their companies' public disclosures and financial statements and suggests officers who abuse their power should be banned from corporate leadership.

In the wake of Enron, US chief executives are eager to make clear that they are following the line of greatest transparency and integrity. General Electric, the conglomerate, and International Business Machines, the computer group, are among the large companies that will publish more ample accounts for 2001 within the next few days, answering criticism of their financial reporting during the boom years.

But chief executives are still afraid that the Bush proposals represent the lightly armed vanguard of more onerous legislation that could hamper their attempts to recover from the downturn and remain competitive inter-nationally. What is more, they believe that legislation, regulation and - crucially - litigation could make it difficult to recruit directors.

A poll last month of members of the Business Council, an association of chief executives from some of the largest US companies, indicated that 95 per cent of corporate chiefs expected legislation to tackle the issues and 79 per cent thought the main effect would be to increase the cost of doing business.

At their biannual meeting in Boca Raton, Florida, last week, many chief executives said they feared candidates for the board - and particularly those asked to join the audit committees - would question whether the benefits of membership outweighed the risks of being pilloried in the media, or sued. With characteristic hyperbole, Scott McNealy, chief executive of Sun Microsystems, described the atmosphere as akin to "mob lynching".

Anne Mulcahy, chief executive of Xerox, said this week that the copier group's search for a replacement chief financial officer had been slowed down by the implications of the Enron collapse. The company, whose accounting methods are being examined by the Securities and Exchange Commission, is vetting candidates more carefully - and vice versa.

John Challenger, chief executive of Chicago outplacement firm Challenger Gray & Christmas, points out that chief executives have been under pressure since the stock market slump began in 2000. The number of CEO departures announced by companies peaked between August of that year and February 2001 and has since flattened out. He says there will "probably be another outcry and backlash against CEOs as the Enron [situation] evolves - but it is the boards that are really going to be transformed in the next few years".

But corporate activists say that a shake-up in the boardroom would be a good thing, provided it does not go too far and deter good candidates. Nell Minow, who runs The Corporate Library, a governance website, says poor attendance and laziness were characteristics of US boards until Enron. "Boards have suffered for a long time from the service of many people who don't want to work too hard - and I'm glad to see them go. On the other hand, I don't want to make it more onerous so that people turn the invitations down."

Ms Brancato says the reaction of some directors asked to join the audit committee of big companies is now: "You've got to be kidding." Warren Buffett, the head of Berkshire Hathaway, the investment group, said on Mon day that audit committees should become more adversarial in their dealings with management and independent auditors.

"Auditors have been somewhat compliant when management has pushed them. Audit committees need to hold auditors' feet to the fire," he told a meeting held by the SEC to discuss audit reforms.

There are questions, however, about how much chief executives and directors can or should know about the detailed workings of complex companies. Jeffrey Skilling, Enron's former chief executive, has testified that he did not know everything about the partnerships set up by the energy trader. In a letter to members of congress investigating the scandal, his lawyer wrote: "He was not . . . involved in every detail of the transactions, nor would he - as CEO - be expected to."

Critics have cast doubt on his ignorance defence but most chief executives have always expected to delegate responsibilities to experts. As one chief executive puts it: "Some of the expectations of boards are overstated. The Enron board would have no idea what was going on just by taking a look at the Enron [energy] trading activity - and nor would any other board, by the way."

The White House has itself admitted it shied away from more stringent proposals that could have made the lives of top corporate executives in the US more difficult. These proposals were made only days ago by none other than Paul O'Neill, Mr Bush's treasury secretary, who headed the administration's task force on corporate governance.

For instance, Mr O'Neill had proposed barring corporate executives from taking out insurance policies that pay legal fees and court judgments against them when their company is found to have released inadequate financial information. But a senior administration official says that the White House decided such a provision would be overkill, since so-called "wilful acts" of concealment are already excluded from such policies.

The treasury secretary had also suggested lowering the threshold for executives' legal responsibility for corporate failures, which currently holds them liable only for "recklessness". Mr O'Neill had wanted to change that standard to "negligence" but the administration backed away, saying it would hold executives legally responsible for mere business judgments.

"Investors don't get a guaranteed outcome," says the official. "Businessmen can make boo-boos. When you invest in a company in which a businessman makes a mistake, a business judgment mistake, no one wants to have anyone be guaranteed for those returns."

The O'Neill proposals might have been a step too far in demonising executives trying to make their way through the minefield of potential litigation and punishment. In any case, according to some observers, mere discussion of greater regulation is already having an impact on companies. It is the "best of times and the worst of times" for corporate governance, according to Ms Minow. "It's a bad time for governance but a good time for reform."

Additional reporting by Tally Goldstein