HP Board Shakeout: Five New Members In, Four Out
Maybe it’s the residual effect of Mark Hurd’s sudden departure from the company in September 2010. Or maybe it’s new CEO Leo Apotheker simply cleaning house. Either way, Hewlett-Packard’s Board of Directors has undergone a major shakeup, with five new directors named and four being shown the door.
The new directors are Shumeet Banerji, CEO of Booz & Co.; Gary Reiner, former CIO at GE; Patricia Russo, ex-CEO of Alcatel-Lucent; Dominique Senequier, CEO of AXA Private Equity; and Meg Whitman, ex-CEO of eBay (and failed California gubernatorial candidate). They will replace Joel Hyatt, John Joyce, Robert Ryan and Lucille Salhany, none of whom will seek re-election in the March 2011 shareholder meeting, according to HP.
No doubt the new blood will have an impact on the board, which some say was long overdue. Although HP isn’t giving any reasons why, reports say the ouster of Hyatt, Joyce, Ryan and Salhany remove those directors who remained loyal to Hurd even after his resignation over sexual harassment charges. At the time of his resignation, Hurd was given a $53 million severance package, prompting a shareholder lawsuit alleging that the package was too extravagant and HP’s board had been financially irresponsible in granting it.
All the incoming board members are either directly or indirectly involved in the technology space, which – if one were to draw conclusions – could signal a desire by HP to get back to its roots as a technology innovator. In contrast, of the outgoing board members, only one – John Joyce – had a background in technology.
It has been a tough decade for the technology company, starting with its acquisition of Compaq in 2001, which was opposed by a number of shareholders including heirs of HP co-founders William Hewlett and David Packard and HP board member Walter Hewlett. In 2005, then-CEO Carly Fiorina was ousted following a fight with the Board over the company’s direction and was replaced by CFO Robert Wayman as interim CEO. Hurd took the reins in April 2005 and actually was doing well for the company until his unseemly departure.
It’s too soon to measure the effects of such a large shakeup, but it’s clear they will be significant. You can be sure we’ll be keeping our eyes on HP as it moves forward and – hopefully well – beyond its last tumultuous decade.
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