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February 2, 2017 - Issue 3.5 - Your weekly news on all things board.
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Director's Domain: Today's perspective from the boardroom. Brought to you by Boardspan.
ExxonMobil adds an atmospheric scientist to its board? Yes, you read that right. Some critics are crying ‘too little too late,’ but the Union of Concerned Scientists gives the oil company a thumbs up for appointing a climate scientist as a director. Meanwhile, a new activist investor-defense group at Lazard is using big data to help companies spot potentially vocal shareholders before they raise their voices. And boards looking to help their CEOs succeed (and thereby give activists no grounds for complaining) are turning to a timeless tactic: More and better feedback!
 
Perhaps the biggest news affecting boards all year is the new Boardspan website. Now it’s easier than ever for your board to engage with cutting-edge recruiting tools, assessments, information access and more. Plus, board candidates can get help building a state-of-the-art Board Profile and getting it in front of the right people. Visit today: Boardspan.com

In the Spotlight


New Exxon Director: A Climate Scientist

“Besieged by court battles over its past positions on climate change, ExxonMobil has added a climate scientist to its board of directors. Some environmental groups see that as a positive thing; others call it too little, too late to make amends for contributing to global warming. The oil giant announced that it had added Susan Avery, a physicist and atmospheric scientist, and former president and director of the Woods Hole Oceanographic Institution in Massachusetts. During her career, Avery authored or co-authored more than 80 peer-reviewed articles on atmospheric dynamics and variability, the company said.” WASHINGTON POST

Across the Board

Curated news and insights from the world's boardrooms.
 

Big Data: First Line of Defense Against Activist Investors

“On the 61st floor of the iconic 30 Rock building in Midtown Manhattan, Jim Rossman’s team is embarking on a big data project this year. Its mission: analyzing shareholder ownership in a way that could help chief executive officers hang on to their jobs. Rossman, who heads the corporate preparedness group at Lazard, has expanded his team globally to more than a dozen activist-defense bankers over the past three years. Among their tasks is a comprehensive study of every investor reporting holdings in any of 1,000 companies, including all of the S&P 500 constituents. The bankers are calculating how much of each stock is owned by an exchange-traded fund, a mutual fund, a hedge fund, or other asset manager. That way, Rossman says, he can start to predict how influential an activist investor may be...” BLOOMBERG
 

Different Businesses Require Distinct Types of CEOs

“People like Mark Zuckerberg and the Google founders … were terrible communicators, not charismatic, and very wary of the press. They didn’t have to be good storytellers because their businesses spread virally and their products stood for themselves. Uber and Airbnb are different. The first thing that happened to these companies was that they became involved in regulatory battles with cities…. Because of these challenges, these companies required a different kind of CEO — extroverted, a good storyteller, a politician, someone who could charismatically rally customers to their cause.” HARVARD BUSINESS REVIEW
 

How Great Boards Help Their CEOs Succeed

Every board wants its CEO to thrive--and there’s one simple thing all boards can do to improve the odds: Offer FEEDBACK. It’s surprising how many boards expect top performance from their executives, but only give feedback when they have a specific disagreement or concern about performance metrics. That’s an enormous missed opportunity. Executives have a much better chance for success when organizations undertake a well-planned, objective annual CEO 360 Review with the participation of the full board and key executives. BOARDSPAN
 

More Companies Targeted by Activist Shareholders

“Chief executives at U.S. corporations were targeted by money managers and activist investors telling them how to run their businesses more than ever last year. Activists, including Jeff Smith's Starboard Value LP and Paul Singer's Elliott Management and others who normally do not weigh in on corporate affairs, asked for board seats at 212 companies in 2016, according to data released on Wednesday by research group Activist Insight. That marks a 14 percent increase in the number of companies targeted from 2015.” REUTERS


Setting Up Your First Board? Some Advice

“Choosing the right board members is one of the most challenging tasks a company can face. There is an art to assembling a team of advisors that can drive strategy, mentor and guide key executives, deeply understand the company culture, and play nicely with each other in and out of the boardroom…. A high performance board will drive strategy, broaden your perspective, and identify obstacles and opportunities. That means you need people who know things that you don’t.… You need a mix of voices, chosen for their respective abilities and aptitudes, not just their familiarity with you and your business.” FORBES

In Case You Missed It

Leadership Matters: What Boards Can Learn from the Wells Fargo Calamity

We’re living in times when what we say and what we do matters. We want our leaders to be role models. And no leadership role is more important or influential in the corporate world than that of the board. Thus, the bar for boards is high and getting higher. Given the access to information, expectations of , expectations of transparency, and significant dollars at stake, the onus is on boards to get it right. And the penalties for not – well, they’re very real. Enter: Wells Fargo. The bank was roiled this fall by an ethics scandal that defrauded customers, cost thousands of employees their jobs, resulted in millions of dollars in fines, caused a precipitous drop in stock price, and culminated in the CEO stepping down.  Many looked to the board for leadership through the crisis. By examining the events at Wells Fargo, other directors can learn from this board’s experiences: What went right? What went wrong? How should a board fulfill its responsibilities?   BOARDSPAN

 Seat at the Table

  • Delta Air Lines welcomes to its board Jeanne P. Jackson, senior strategic advisor to the CEO of Nike and a current director for McDonald's and Kraft Heinz Company
  • Cleaning product and personal care company Clorox elects to its board Russell J.  Weiner, president of pizza chain Domino's USA
  • Xerox Corp appoints to its board Xerox CEO Jeff Jacobson, and Motorola Solutions chairman and CEO Greg Brown
  • Carl Stern, former CEO and chairman of Boston Consulting Group, joins the board of bitcoin payment processor BitPay
  • PeterA. Altabef, president and CEO of global IT company Unisys, joins the board of NiSource, a regional utility company based in Indiana
  • Jane DeFlorio, lead independent director for clothing maker Perry Ellis and a former investment banker (Deutsche Bank and Morgan Stanley), joins the board of DDR, an owner and manager of shopping centers in 35 states and Puerto Rico
  • Media company Meredith Corp, which owns Better Homes & Gardens, Shape and other media brands, appoints to its board Beth J. Kaplan, former president and COO of Rent the Runway and former president and CMO at General Nutrition Corporation
  • DNA-sequencing company Illumina welcomes to its board Caroline Dorsa, who held various positions at pharmaceutical company Merck including SVP of marketing strategy & integration and treasurer
  • Signet Jewelers, parent of Kay, Zales and others with some 3600 jewelry stores, announces an executive reorganization including the retirement of its CEO, and appoints to its board Brian A. Tilzer, chief digital officer for retail pharmacy chain CVS Health and former SVP of global e-commerce for office supply chain Staples
  • Furniture maker Stanley Furniture heads off a proxy fight with its appointment of Stephen Hale II, whose Hale Partnership Fund owns about 10% of the company’s stock and had  suggested it would not back the company’s candidates at the annual meeting
  • Inventure Foods, parent company of Jamba, TGI Friday’s, Nathan’s Famous and others, elects to its board Joel Stewart, VP of private equity firm LKCM Headwater Investments
  • Biopharmaceutical company Marinus Pharmaceuticals, which focuses on treatments for epilepsy and neuropsychiatric disorders, appoints to its board Michael R. Dougherty, executive chairman of Celator Pharmaceuticals and former CEO of Kalidex Pharmaceuticals
  • Scott W. Morrison retired U.S. life sciences leader at Ernst & Young, joins the board of Symic Bio, a biopharmaceutical company focused on matrix biology
  • Ranch C. Kimball former CEO of the Joslin Diabetes Center and a past Secretary of Economic Development for the Commonwealth of Massachusetts, joins the board of antibody therapeutics pioneer Immune Pharmaceuticals
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