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November 18, 2006 1:22 am
Mark Hurd, chairman and chief execeutive of Hewlett-Packard, has tapped a Silicon Valley outsider to fill the first of two board seats left vacant in the wake of the spying scandal that rocked the world’s second-biggest computer maker this year.
In a filing lodged late on Friday, HP said it had appointed G Kennedy Thompson, chairman and chief executive of Wachovia, one of the biggest US retail banks, to its board of directors.
“[Mr Thompson’s] independence, extensive experience running a large, complex organisation, and outstanding character will make him a valued asset to our company,’’ Mr Hurd said in a statement.
The decision to appoint a Silicon Valley outsider comes as HP seeks to restore its reputation for sound governance following a sensational spying scandal that gutted its board this year.
The controversy boiled over in September after HP admitted that its investigators used questionable and potentially illegal tactics to uncover the source of a boardroom leak.
The revelations led to the ousting of Patricia Dunn, HP’s former chairman, who oversaw the leak investigation. It also led to the departure of George Keyworth, a long-time director and Silicon Valley luminary who was found to have leaked details of confidential boardroom discussions to the press.
A third seat has been vacant since May, when Tom Perkins, the legendary Silicon Valley venture capitalist, quit in protest over the board’s investigative tactics. Following his departure, HP said it had reduced the number of company directors from 11 to 10.
HP said it would pay Mr Thompson an annual cash retainer of $50,000, along with another $150,000 a year in stock.
Mr Hurd, who assumed the role of chairman after Ms Dunn’s departure in September, said in a conference call on Thursday that HP’s aim was to build “the best board we possibly can, the best board on the planet”.
During his five years as head of Wachovia, Mr Thomson has presided over several big mergers, including the group’s $14.3bn takeover of SouthTrust, a deal that turned Wachovia into the fourth-biggest US bank by holdings.
HP’s shares slipped 0.9 per cent to $39.77 ahead of the announcement. The slide came a day after HP reported strong quarterly results and raised its guidance for the coming quarter.
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