March 16, 2017 - Issue 3.11 - 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.
Reporters and critics have a lot to say about an SEC disclosure made by Yahoo on Monday stating that CEO Marissa Mayer will leave with a golden parachute of $23 million, after failing in her bid to turn the company around. The noise is even louder around the revelation that her successor, current Yahoo director and former IAC chief executive Thomas McInerney, will be paid double Mayer's salary for what some consider a less-demanding job. Meanwhile, the chairman of the British supermarket chain Tesco suggested the days are numbered for white men on boards of directors—even as Boardspan CEO Abby Adlerman sheds light on why some male-dominated boards are reluctant to respond to calls to change their composition.

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In the Spotlight

Yahoo Director In Line to Become (Well Paid) CEO

“Even after Yahoo goes through with the sale of its core business, it will still pay its top executives handsomely—and in some cases, even better than it did before. In announcing a plan for the company's future Monday, Yahoo said it had picked a new CEO to replace Marissa Mayer once its deal with Verizon officially closes. Yahoo is selling its technology and advertising business to Verizon, and the remaining company will consist only of the hoard of Alibaba  stock that Yahoo owns, its stake in Yahoo Japan, and a miscellaneous array of smaller investments. Running the leftover stump of Yahoo is likely to be a much simpler and easier job than the one Mayer had, from which she is walking away with a $23 million severance package. … But Mayer's replacement, [current Yahoo director] Thomas McInerney, seems in many ways to be getting an even sweeter deal. McInerney, the former chief executive of IAC (the Internet media company once known as InterActiveCorp, which owns dating sites including, will get a starting base salary of $2 million to become Yahoo's new CEO, according to the offer letter made public Monday. That's double the $1 million base salary that Mayer currently takes home...” FORTUNE

Across the Board

Curated news and insights from the world's boardrooms.

Which is Mightier: The Carrot or the Stick?

State Street Global Advisors last week announced that they will no longer support companies that allow boardroom one-sidedness. That’s a fresh approach to an old problem, according to one money-manger interviewed by the Washington Post. She likened the announcement to a carrot-and-stick strategy. We’ve all heard about the CARROT: Statistics have shown for years that companies with more diverse boards perform better financially. Yet boardroom composition hasn’t changed all that much. Enter the STICK: State Street, the second largest US investor with $2.5 trillion under management, warning it will vote against director re-elections where there’s no women on the board. But without understanding why the carrot doesn’t work, it’s dangerous to rely only on the stick. State Street’s spotlight on the topic helps but will this bold move create lasting impact? Do companies care enough about keeping one institutional investor happy to change their behavior and…change their board composition? State Street certainly hopes so. But hope is not a strategy. BOARDSPAN

Win Some, Lose Some, To The Tune of $2.8 Billion

“Bill Ackman has finally conceded defeat on Valeant Pharmaceuticals International Inc. After waging a costly and outspoken public defense of the controversial drugmaker, its once-biggest champion sold his entire stake in the company at a loss and said he will leave the board. Precise figures are hard to come by, but public filings suggest that Ackman’s Pershing Square Capital Management may have lost $2.8 billion just on the Valeant shares it owned at the end of 2016, with overall losses likely to be much higher. The shares have plunged more than 90 percent from their peak.” BLOOMBERG

Corporate Behavior Being What It Is, Boards Need to Step Up

“Wells Fargo also recently stripped CEO Tim Sloan and seven of his top lieutenants of their 2016 bonuses, fired four other executives, and discontinued the stringent sales quotas that unwittingly incentivized bank employees to set up 2 million unauthorized consumer bank accounts. All of this comes as Wells Fargo braces for the release of findings from an independent board investigation, which is expected prior to what could be a contentious annual meeting with shareholders on April 25. A disturbing backdrop to this story is that Wells Fargo’s fall from grace is not an isolated aberration, but only the latest in a series of corporate scandals that have betrayed consumer trust and destroyed shareholder value in many large enterprises, including Enron, HealthSouth, Tyco, Arthur Andersen, Siemens, Barclays, BP, General Motors, Takata and, most recently, Volkswagen.  Why is unethical corporate behavior so prevalent and what can be done to prevent future falls from grace?  The short answer is that CEOs often suffer cultural myopia and outside directors frequently fail to provide adequate oversight. Corporate cultural breakdowns tend to emerge as gradual backsliding from a company’s noble founding vision, rather than as a sudden, reckless unethical act….” FORBES

Should Your Next Board Member Be a CIO?

“It’s no wonder CIOs are the fastest-growing addition to the boardroom: They can help address a host of issues of crucial importance to boards, including using technologies to create operational efficiencies and competitive advantage; identifying opportunities related to cloud computing, digitization, and data; addressing threats and risks associated with information security; and using their experience and judgment to oversee, question, and provide input on technology budgets….The CIO on the board is often a valuable translator between the board, the internal CIO, and other technology-related functions. In this regard, a CIO director can play a pivotal role in educating other board members and the CEO, giving them the ability to knowledgeably probe on technology matters.” HARVARD BUSINESS REVIEW

Why Is Airbnb Inviting Property Owners to Board Meetings?

“This week, Airbnb CEO Brian Chesky announced that he would step up communications with property owners who use his home-sharing startup by creating an advisory board of users and inviting a few users to provide feedback, once a year, at a company board meeting….Chesky’s idea of inviting a few users to a company board meeting each year is a welcome idea and akin to practices many boards employ in inviting major customers or suppliers to provide insights to the board as part of the board’s meeting agenda and strategic reviews. That said, the moves at Airbnb do seem to suggest an attempt to circle the wagons in the face of legal challenges and in advance of a possible IPO. If Airbnb plans an IPO any time soon, Chesky’s statements on Tuesday suggest he will need to know more about what good governance really involves. The company will need to start holding more than a measly four board meetings a year and independent board members, rather than Chesky, will need to take control of the agenda and select the landlords who attend board meetings.” FORTUNE

BofA Reconsiders CEO-Chair Split

“Shareholders in Bank of America will get another vote on whether the chairman and chief executive roles should be separated, almost two years after the incumbent Brian Moynihan survived an investor rebellion on the matter. A shareholder proposal in the bank’s proxy filing published on Wednesday calls for the chairman to be independent. It will be put to a vote at the annual meeting in Charlotte, North Carolina, next month.” FINANCIAL TIMES

Carl Icahn Reportedly Behind Ouster of AIG CEO

“American International Group Inc's decision to remove Peter Hancock as its chief executive was to avoid a proxy battle with billionaire activist investor Carl Icahn, the Wall Street Journal reported, citing people familiar with the matter. AIG said last week that Hancock would step down, a decision he made after the insurer's poor financial performance frustrated shareholders and its board of directors.” REUTERS

Are White Male Directors Endangered by “Diversity?”

“Tesco Plc Chairman John Allan backtracked on his comments about the disadvantages for white men in corporate boardrooms as critics urged greater diversity of the retailer’s directors and some shoppers said they would boycott the U.K.’s biggest supermarket chain. ‘The point I was seeking to make was that successful boards must be active in bringing together a diverse and representative set of people,’ Allan said Saturday in a statement on Tesco’s website. ‘There is still much more to be done but now is a good time for women to put themselves forward for non-executive director roles.’ Allan, speaking at a conference in London on Thursday, said white men were an ‘endangered species’ on corporate boards and had to ‘work twice as hard.’” BLOOMBERG

Reid Hoffman Joins Microsoft Board

“LinkedIn co-founder Reid Hoffman announced today that he’s joined the board of directors at Microsoft. This follows Microsoft’s $26.2 billion acquisition of LinkedIn last year… In a LinkedIn post, Hoffman said his primary job is still as a partner at Greylock, but he’s ‘maintained an office next to Jeff Weiner’s at LinkedIn for the last nine years’ — so he’s remained very involved. (Officially, he was chairman of the LinkedIn board.) As a Microsoft board member, Hoffman said his focus will remain on LinkedIn itself, while also working to help Microsoft build more connections in Silicon Valley.” TECH CRUNCH

Slack Adds First Independent (Woman) Director

“Slack, the popular business communications platform, has added Square CFO Sarah Friar as its first independent board member. She will also become its first female director. In an interview, while stressing diversity has been an important aim in expanding its board, Slack CEO and founder Stewart Butterfield noted that Friar’s extensive background in enterprise and finance was the key reason for her selection. She certainly has that resume. Friar is currently the CFO of payments company Square. In addition, some consider her a prime candidate for the CEO job if Jack Dorsey ever decided to only lead Twitter, where he is also CEO.” RECODE

HSBC Gets a New Chairman, And Next, a CEO

“Mark Tucker, chief executive of the Asian life insurer AIA Group, is set to replace Douglas Flint as chairman of HSBC in October, the bank said on Sunday. Mr. Tucker, 59, would be the first outsider to take the chairman’s role at HSBC as the bank, which is based in London but generates much of its profit in Asia, reshapes its leadership. He is expected to relocate from Hong Kong to London for the role. One of Mr. Tucker’s first duties would be to lead the search for a replacement for HSBC’s chief executive, Stuart Gulliver, who plans to retire. The bank has shaken up its board in the past year, adding four new independent directors.” NEW YORK TIMES

From the Boardspan Archives

The Advantages of a Diverse Board

"Bottom Line: When it comes to corporate multiculturalism, it’s the relationship between an ethnically diverse board and its CEO that makes the biggest difference for leading firms." STRATEGY+BUSINESS via BOARDSPAN

 Seat at the Table

  • Lynn Vojvodich, former EVP and CMO of Salesforce and a director at travel company Priceline, joins the board of automaker Ford Motor Co
  • Networking-technology company Cisco appoints to its board Brenton L. Saunders, chairman, president and CEO of pharmaceutical company Allergan
  • Discount and coupon company Groupon welcomes to its board Joey Levin, CEO of IAC, the Internet media company whose holdings include Vimeo,, Tinder, and others
  • Susan E. Siegel, CEO of GE Ventures, joins the board of Align Technology, maker of orthodontics technologies including Invisalign
  • Pauline Brown, previously chair of North America for LVMH Moët Hennessy Louis Vuitton and a former managing director of the private equity firm The Carlyle Group, joins the board of Del Frisco’s Restaurant Group
  • Pankaj Patel, formerly SVP and chief development officer at Cisco Systems, joins the board of cybersecurity firm E8 Security
  • Liza Landsman, president and chief customer officer of, an online retailer recently acquired by Wal-Mart, joins the board of Veritiv, a B2B distribution solutions company
  • Jean-Jacques Louis, SVP of corporate strategy at Nasdaq, joins the board of Hanweck, a provider of real-time risk analytics on global derivatives markets
  • Restaurant franchise Wingstop appoints company president and CEO Charlie Morrison to chairman, and welcomes to its board Kilandigalu (Kay) M. Madati, EVP and chief digital officer at BET Networks, the Viacom-owned network that focuses on African American audiences
  • Plexus, a product design and execution company, elects to its board Paul A. Rooke, former chairman and CEO of Lexmark International, Inc., a provider of document imaging and enterprise software solutions
  • BioNovelus, a tech company focused on agriculture and water issues, appoints to its board Anthony J. Parkinson, who was an investment banker then a cofounder of workforce management software firm Kronos
  • Maria Contreras-Sweet, former Administrator for the U.S. Small Business Administration and member of former President Obama's cabinet joins the board of power plant operator Sempra Energy
  • Biotech firm GlycoMimetics appoints to its board Scott Koenig, M.D., Ph.D., president, CEO and director of MacroGenics a company specializing in antibody-based therapies for cancers and other diseases; he is also chairman of the board of the Applied Genetic Technologies Corporation
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