The Lew Platt Test

The HP boardroom has been full of sturm und drang for a decade, dating back to Carly Fiorina's arrival in 1999 as an outsider CEO. It may be hard to fathom after the recent tumult, but a steadier state did actually exist at one time.

Back in 1997 Directors & Boards caught up with then chairman and CEO Lewis Platt for a cover article he authored on "Governance the H-P Way." Platt was a lifer at HP, having joined the company as an entry-level engineer in 1966 and worked his way up to being appointed CEO in 1992 and chairman in 1993.

As I am continually reminded, words from the past have a way of echoing through the ages to resonate pertinently on present circumstances. I say no more but simply share with you the concluding paragraph of Lew Platt's article:

"A good test of whether your board is functioning well is if you can answer 'yes' to the question, 'Do I feel free to discuss anything with my board . . . to talk with full candor about anything that's worrying me?' I feel fortunate in this regard. Not all CEOs can say the same. For one reason or another, something goes wrong with the relationship between the CEO and the board, or between company management and the board, which leads to secrets, to a lack of trust, to poor board performance, and ultimately to poor corporate performance. My board has been very helpful to me with its perspective and advice, and our candid dialogue takes place in an atmosphere of mutual respect, which is the key to having a good board relationship."

Upon retiring from HP in 1999, Platt went on to serve as CEO of Kendall-Jackson Wine Estates and as a corporate director. Interestingly, he was nonexecutive chairman of Boeing Co. when its board in 2005 forced the resignation of CEO Harry Stonecipher over an affair with a company employee. Platt died later that year at the age of 64.

What You Say

Be mindful of what you say — inside or outside of a board meeting.

It is a learning point from Walter Green, former chairman and CEO of Harrison Conference Services, a leading conference center management company. He has written a book, "This Is the Moment" (Hay House), that will be coming out this fall in which he describes a fascinating personal undertaking. Over the course of a year he went on the road to reconnect with 44 people who played an important role in his life — at which time he expressed to them his gratitude for how they shaped the person he became.

It was striking to him to realize that, often unaware at the moment, he did his own fair share of shaping.

Green writes: "We all do some things in life automatically, and that doesn't diminish the value of them. As my friend Stephen Kaufman, a senior lecturer at Harvard Business School (and one of my 44), told me, 'Many times we fail to realize that simple, off-the-cuff comments or reactions that don't really register with us can touch important nerves or strike chords in others. My students and former colleagues often drop me notes referring to something I did or said five or ten years ago as having had a deep impact on them, yet at the time they just seemed to me like ordinary conversations with no particular import.' "

Green's important conclusion: "To be reminded of the variety of ways in which we impact people — no matter what our condition or position or locale — left an indelible impression on me. Being made aware of the value to others of what we do or say made me vividly conscious of how I might be more helpful in the future as well."

A sound piece of advice for modulating your formal interactions — and perhaps even more consequentially, those casual tossed-off comments — with your management team and fellow board members.

Who Speaks for the Board?

In the news coverage of the tumult at AIG, one particular Wall Street Journal article caught my attention — and not in a good way. Last November the WSJ reported that new CEO Robert Benmosche was threatening to quit, and that the AIG board was scrambling to salvage the situation. Pretty momentous developments, considering the still precarious state not only of AIG but of the broader financial community and markets.

Asked by the reporters about what was happening at the board level, this is what ended up in the article: "A spokesman for the giant insurer said the company doesn't comment on board activities."

Well, okay.

Then, next question: Who does speak for the board?

Unfortunately, no one seems to. Many if not most boards simply have no voice of their own.

That has been the longstanding tradition — that the corporation speaks with one voice, that of management's.

Is this a good thing anymore? Is this responsible behavior for boards in today's environment of fuller transparency and disclosure — to have no voice of their own? And, if they were to decide to find their voice, whose voice should it be? And how should it be expressed? Should a board have its own PR representation, just as many are now doing in hiring their own independent compensation advisers? Are we headed down that path?

All good questions, I think. And I am on a search for some answers. Stay tuned. I am going to ask some smart people — in governance, the investor community, and corporate communications — to help me with some answers. I will be making this a major feature article in the Second Quarter edition of Directors & Boards.

It should be a good one — one that advances leadership thinking in what are, or should be, "new normal" best board practices.

The 'Very Public' Director

I read in a newsletter for public relations professionals that today is the birthday of Howard J. Rubenstein. The founder and president of Rubenstein Associates Inc. is a counselor to some of the most influential business executives and corporations in the country.

I turned to him five years ago for some thoughts on how a board has to rise to the challenge of managing its own image in an era of increasing transparency. In the old days, a board could hide behind management's screen (or stone wall). The board did not speak for management, much less for itself. The corporation spoke with one voice, that of the CEO.

Well, change is afoot, and Howard recognized that, as should a PR master and maestro like himself. Here is what he put forward in an article that he wrote for Directors & Boards in 2005, titled "The 'Very Public' Public Company Director":

“In many ways, a gauntlet has been thrown down. Each in their own way, regulators, shareholders and the press have signaled to boards and directors that they expect more of them. Those of us who work regularly with boards of directors know that additional responsibility is not something they will shy away from. The vast majority of directors are conscientious, competent, and qualified, and the boards they serve on are engaged, demanding, and committed to representing the best interests of shareholders. The new skill that boards must cultivate in a more transparent and open environment is the ability to communicate how their good intentions, motivations, and actions work to enhance the strength and value of the company as a whole” (emphasis mine).

Yes — a new skill, indeed. It is one that directors have not had to cultivate as long as the boardroom has been a cloistered chamber. But Howard Rubenstein recognized five years ago the dawning of a new age of disclosure and its implications for public company board members. Thank you for that, Howard, and best wishes for many more birthdays.

By the way, the New Yorker did a profile of Howard, titled "The Fixer," that offers quite a insight into the man and his methods. I won't be surprised if more than a few boardrooms need his and his PR peers' brand of fixing as they cultivate their image management.