Saturday, April 20, 2013

HP Shareholder: 'Boards Are Like Hotel California. Directors Check In But They Never Check Out'

Posted By on Sat, Apr 20, 2013 at 1:00 PM

When Hewlett-Packard announced to its shareholders and employees—including hundreds of staff at its Boise campus—that its chairman and two directors were resigning, the company painted a picture of corporate harmony in the decision.

"Today's announcement is a testament to our chairman's and departing board members' statesmanship and sterling professional standards," the company said in a statement earlier this month.

But this morning's New York Times reveals a different scenario behind HP's closed doors. In fact, the Times' headline dubs outgoing chairman Raymond Lane as "obstinate."

The ouster of Lane followed a 50 percent plunge in HP stock value and the expensive hiring and firing of a new chief executive. But the Times reports that "it took the combined effort of the company's new chief executive, Meg Whitman, other board members and Dodge & Cox, a mutual fund company that is HP's largest shareholder, to get Lane to give up the chairman's title."

But even when Lane was forced out as chairman, he still refused to leave the HP board.

Boards "are like the Hotel California," HP shareholder William Patterson told the Times. "Directors check in but they never check out. It's so hard to mount and win a campaign, and even then, they stay.Shareholders need to mobilize for a second round. Our work is far from complete."

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