Andrew Mason, the chief executive officer of Groupon, has, in his own words, been fired. His resignation letter has been described in the press as charming, but the market seemed to think it was simply about time. Shares in Groupon went up more than 10 percent following the announcement on Thursday.
Lucy P. Marcus
On the 50th anniversary of the publication of Betty Friedan’s The Feminine Mystique I’ve started to wonder how far we’ve come in the boardroom. As I finished a conversation with a search firm that specializes in oil, gas and mining this week I questioned the level of progress.
As we move into the year, companies and their leaders are under greater scrutiny than ever. In one of my meetings with institutional investors recently, someone asked whether chief executive officers should sit as independent directors on the boards of other companies. CEOs who sit on too many boards risk getting overloaded and splitting their time, energy and commitment to the extent that they do none of their jobs well. Get the balance right, though, and CEOs on outside boards can bring benefits to all the organizations with which they are involved.
“The level of ignorance seems staggering to the point of incredulity. Not only were you ignorant of what was going on, but you were out of your depth.”
I’m preparing for an upcoming board audit committee meeting, and I am conscious that I am reading the briefing papers more carefully, slowly and deliberately than usual. I am always thorough, but recent events have given me pause. I am sure I am not the only member of an audit committee who, seeing the headlines about accounting that touch the boardroom, is taking extra care of late.
When news emerged in May that Facebook had hired an executive search firm to look for a woman to add to its board of directors, I had hoped that with the appointment would come a great deal of diversity of thought and experience and an independent voice. Facebook has now announced that it has chosen its COO, Sheryl Sandberg, to join its board. Having Sandberg on the board is a good step, but does it address the larger shortcomings that are concerning Facebook users and investors?
The corporate world is emerging from several weeks of boardroom turbulence dubbed the “Shareholder Spring.” In annual meeting after annual meeting around the world, boards have been taken to task by investors and other stakeholders on a wide range of issues: remuneration, board composition, competence, diversity, voting control, dual stock, and more. In the meantime, we have also witnessed the soap opera of Yahoo’s boardroom, the rebuke to newly public Groupon’s board for its lack of oversight of accounting practices, and the public condemnation of News International’s chair – and, by extension, its board – questioning his competence to lead the organization. No sector has been immune; no director has been untouchable.