HP's board room drama
Mark Hurd is out at the behest of HP's board. The official announcement is that "Mark had failed to disclose a close personal relationship he had with the contractor that constituted a conflict of interest, failed to maintain accurate expense reports, and misused company assets".
There remain many questions on the relationship between the chief and the board. Not only for Hurd.
The board cleared the contractor's sexual harassment charge but remained that "Mark had failed to disclose a close personal relationship". It seems a contradicting statement. Also reported on Saturday was that Hurd reached settlement with the contractor. So even after the Friday's announcement, Hurd was still working on the case. But the board cleared Hurd and let him go. As for the expense reports and company assets, according to "person familiar with the situation", is between $1000 to $20,000.
Everything is from "person familiar with the situation", the board since now won't be involved it anymore. What is happening in the board room? One widely reported drama occurred in 2006. A scandal erupted over "pretexting"—impersonating people to get their phone or financial records—amid a divisive internal investigation into possible press leaks by the company's own directors. That ultimately contributed to the departure of Patricia Dunn as H-P chairwoman.
At that drama the board chairwoman was out and this time, also the chairman of the board was out by the board. Same as Fiorina in 2005. Note that Hurd and Fiorina are outsider but Patricia is not.
HP has strange relationship between the board and the CEO, very unusual.
When shareholders are less engaged in company's operation, the CEOs begin to recommend slates of directors to shareholders, who are soon rubber-stamping them. Periodically this paradigm go astray when a company or its management got into trouble. Examples like Enron and WorldCom are classics. HP is another side of the case. Size like HP, few shareholders are active to corporation events. An exception is the Hewlett and Packard families' open war with Fiorina a few years ago. But the board holds very strong position against the CEO. Under the name to protect investors, the board toppled Fiorina and Hurd. These are long-time HP directors. It is hard to say what they are after: the controversial Fiorina's performance and Hurd's good performance but the 2006 drama? Not sure.
It is well understood, though, HP is sailing well under Hurd and continue to be after Hurd, at least short term. Uncertainties are apparent such as Palm and structuring. All depends on the successor's decision. We should avoid HPQ for a while.
There remain many questions on the relationship between the chief and the board. Not only for Hurd.
The board cleared the contractor's sexual harassment charge but remained that "Mark had failed to disclose a close personal relationship". It seems a contradicting statement. Also reported on Saturday was that Hurd reached settlement with the contractor. So even after the Friday's announcement, Hurd was still working on the case. But the board cleared Hurd and let him go. As for the expense reports and company assets, according to "person familiar with the situation", is between $1000 to $20,000.
Everything is from "person familiar with the situation", the board since now won't be involved it anymore. What is happening in the board room? One widely reported drama occurred in 2006. A scandal erupted over "pretexting"—impersonating people to get their phone or financial records—amid a divisive internal investigation into possible press leaks by the company's own directors. That ultimately contributed to the departure of Patricia Dunn as H-P chairwoman.
At that drama the board chairwoman was out and this time, also the chairman of the board was out by the board. Same as Fiorina in 2005. Note that Hurd and Fiorina are outsider but Patricia is not.
HP has strange relationship between the board and the CEO, very unusual.
When shareholders are less engaged in company's operation, the CEOs begin to recommend slates of directors to shareholders, who are soon rubber-stamping them. Periodically this paradigm go astray when a company or its management got into trouble. Examples like Enron and WorldCom are classics. HP is another side of the case. Size like HP, few shareholders are active to corporation events. An exception is the Hewlett and Packard families' open war with Fiorina a few years ago. But the board holds very strong position against the CEO. Under the name to protect investors, the board toppled Fiorina and Hurd. These are long-time HP directors. It is hard to say what they are after: the controversial Fiorina's performance and Hurd's good performance but the 2006 drama? Not sure.
It is well understood, though, HP is sailing well under Hurd and continue to be after Hurd, at least short term. Uncertainties are apparent such as Palm and structuring. All depends on the successor's decision. We should avoid HPQ for a while.
posted by Intl.investment.services at
7:34 AM
0 Comments:
Post a Comment
Subscribe to Post Comments [Atom]
<< Home