Agenda - May’s Moves: Boards Under Pressure to Change

06/08/2009

By Katie Wagner

Pressure to make changes to boards has increased since the financial crisis began, especially for TARP participants, say board recruiters.

During May, 11 of the 39 director departures occurred at boards whose companies participate in the Troubled Asset Relief Program, according to research using Audit Analytics' database. (The research is based on companies with $3 billion or more in revenues.) TARP participants that announced losses of directors last month include American International Group, which reported that three of its directors were not standing for reelection; PNC Financial Services Group, which announced that one of its directors was retiring; and GMAC, which reported that five of its directors were resigning. Government pressure on TARP companies likely played at least some role in these departures, say director search consultants.

Overall last month, 72 director departures and appointments occurred at all companies included in the report using Audit Analytics' database.

The economy is forcing board composition to be taken more seriously and for boards to look more carefully at the skill sets they need to succeed in the long term, says Dora Vell, CEO of Vell Executive Search. And the stresses on TARP participants are likely even greater, she adds.

Under increased control and pressure from a combination of Congress, the Treasury Department and the White House, boards taking TARP money are re-engineering themselves because their boards are viewed as having failed, says Steve Mader, a board recruiter with Korn/Ferry International.

There's also public pressure on TARP boards to account for the taxpayer money the government has invested in their companies, adds Vell.

Recruiter's Tip

To attract good directors in today's economy, boards need to be transparent about the risks their companies are taking and focus on building relationships with potential board candidates, says Dora Vell, CEO of Vell Executive Search. "You may want to start planning out your board for 2011 now," because right now it's harder to attract CEOs and other desirable board candidates than it used to be, for a variety of reasons, says Vell.

Director Moves From May

Company Director Title Action Filing Date
Bank of America O. Temple Sloan Director Resigned 29-May
M&T Bank Gary Geisel Director Appointed 28-May
Host Hotels & Resorts Judith McHale Director Resigned 28-May
Partnerre Robert Baylis Director Retired 28-May
Thermo Fisher Scientific Thomas Lynch Director Appointed 27-May
Thermo Fisher Scientific Tyler Jacks Director Appointed 27-May
Polo Ralph Lauren Judith McHale Director Resigned 27-May
Virgin Media Gordon McCallum Director Appointed 27-May
Oneok Mollie Williford Director Retired 27-May
Boston Scientific Kristina Johnson Director Resigned 27-May
Boston Scientific Ursula Burns Director Resigned 27-May
First American Patrick Stone Director Resigned 27-May
Transatlantic Holdings Ian H Chippendale Director Appointed 26-May
Transatlantic Holdings John Foos Director Appointed 26-May
Transatlantic Holdings John McCarthy Director Appointed 26-May
Transatlantic Holdings Robert Orlich Director Appointed 26-May
Transatlantic Holdings William Poutsiaka Director Appointed 26-May
Transatlantic Holdings Richard Press Director Appointed 26-May
Transatlantic Holdings Thomas Tizzio Director Appointed 26-May
Motorola Ron Summer Director Resigned 22-May
GMAC T K Duggan Member, Board of Managers Resigned 22-May
GMAC Douglas Hirsch Member, Board of Managers Resigned 22-May
GMAC Robert Hull Member, Board of Managers Resigned 22-May
GMAC Samuel Ramsey Member, Board of Managers Resigned 22-May
GMAC Robert Scully Member, Board of Managers Resigned 22-May
GMAC Robert Blakely Member, Board of Managers Apointed 22-May

Company Director Title Action Filing Date
GMAC Kim Fennebresque Member, Board of Managers Appointed 22-May
Kindred Healthcare Gary Garrison Director Resigned 22-May
Kindred Healthcare John Klein Director Resigned 22-May
Plains All American Pipeline Christopher Temple Director (Plains All American GP LLC) Appointed 22-May
Plains All American Pipeline W Lance Conn Director (Plains All American GP LLC) Appointed 21-May

American International Group

Stephen Bollenbach Director Declined Re-Election 21-May
American International Group Martin Feldstein Director Declined Re-Election 21-May
American International Group James Orr Director Declined Re-Election 21-May
Ross Stores Gregory Quesnel Director Appointed 21-May
Advance Auto Parts Nicholas LaHowchic Director Retired 20-May
Advance Auto Parts Lawrence Castellani Director Retired 20-May
United Stationers Ilene Gordon Director Declined Re-Election 19-May
Henry Schein Margaret Hamburg Director Resigned 19-May
Cameron International Nathan Avery Director Retired 19-May
Comerica William Vititoe Director Retired 19-May
Flowserve Diane Harris Director Retired 14-May
Flowserve Roger Fix Director Appointed 14-May
Flowserve Lewis Kling Director Appointed 14-May
Flowserve James Rollans Director Appointed 14-May
Flowserve Kevin Sheehan Director, Non-Exec. Chariman Employment Ceased 14-May
International Paper Martha Finn Brooks Director Resigned 12-May
Electronic Arts Jeff Huber Director Appointed 11-May
Mylan Milan Puskar Director, Chairman of the Board Retired 7-May
Coventry Healthcare Dale Wolf Director Resigned 7-May
Atmos Energy Robert Crable Director Appointed 7-May
Supervalu Craig Herkert Director Appointed 6-May
Brunswick Michael Callahan Director Retired 6-May
Arrow Electronics William Mitchell Executive Chairman Employment Ceased 5-May
PNC Financial Services Group George Davidson Director Retired 4-May
Biogen Idec Hans Peter Hasler Chairman of the Board (Subsidiary) Appointed 4-May
Brinks James Barker Director Retired 4-May
Rite Aid Michael Friedman Director Resigned 4-May

Company Director Title Action Filing Date
RRI Energy Joel Staff Chairman of Board Retired 4-May
RRI Energy Steven Miller Chairman of Board Appointed 4-May
RRI Energy Donald Breeding Director Retired 4-May
RRI Energy William Transier Director Declined Re-election 4-May
Fresh Del Monte Produce Maher Abu-Ghazaleh Director Resigned 4-May
Fresh Del Monte Produce Madeleine Champion Director Appointed 4-May

Note: companies with revenues of at least $3 billion; list doesn't include filings in which companies specified the move was a re-election; Source: Audit Analytics database

Dora Vell is the CEO of Vell Executive Search, a premier retained technology executive search firm in Boston. Ms. Vell is an internationally recognized expert in executive search for technology CEOs, COOs, CIOs, Vice Presidents and board members. She works with start-up organizations through Fortune 50 Firms. She can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it.