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Eleanor Bloxham had doubts about Meg Whitman when HP hired her. Four months later, Bloxham still has doubts.Bloxham is a well-known corporate governance expert and CEO of The Value Alliance, a firm that advises boardrooms on how to be honest and effective.
“I think Meg still has to prove herself, despite the quick decision on the PC business,” Bloxham told Business Insider. “If Meg wanted to demonstrate her leadership, now is not the time tot leave people wondering about strategy or ethics or governance at the firm.”
When HP hired Whitman as CEO, Bloxham voiced her concerns in her column in Fortune. She pointed out that Whitman had a somewhat shady ethical history. For starters, Whitman’s nomination to HP’s board by Ray Lane circumvented HP’s standard nomination process. Plus, it was only after Whitman was approved to the board by shareholders did word leak that she would be working for Lane’s firm, Kleiner Perkins.
Then there was the older kerfuffle of how Whitman resigned from the Goldman Sachs board in 2002. She allegedly pocketed a cool $1.8 million when Goldman gave her pre-IPO shares for bringing eBay in as an investment bank client.
Bloxham wants to be convinced that Whitman is the trustworthy leader that will cure the company. So she gave us this list of things that Whitman should do ASAP:
1. A strong strategy announcement. “I’d like to see both a re-establishing of a vision for the company and a reassessment of capital allocation and where resources will be put,” says Bloxham. When Leo Apotheker took the helm, his vision was all about software. Since Whitman was on the board at the time, she understood and approved of that strategy so “it’s not like this is a new exercise to be done. One would think that fairly soon, HP should be able to articulate something that’s clear and compelling to both outsiders and employees.”
2. Let employees know where they stand. “What’s the intention is in terms of protecting employee jobs? That’s something employees are very nervous about.”
3. Explain the board’s actions. “I’d like to see her make statements encouraging the full board to be more transparent when it takes actions.” She can start by explaining the history. “For example, there was a big hullabaloo last year over how Lane ran the nominations process that put Meg and a few others on the board.”
She can also tell how Lane’s job changed when his title changed. He went from chairman to executive chairman. Plus, she can explain the role of the new lead independent director, Rajiv Gupta. Gupta is the former chairman and CEO of Rohm & Haas who took the independent director job in November.
4. Work better with shareholders. In the next proxy season, Whitman can show her leadership if the company takes a “less belligerent” and more “even-handed approach to proposals that come forward,” says Bloxham.
Lane blasted several shareholder proposals in the last round, Bloomberg reported. HP also refused to put one proposal in front of shareholders at all — even petitioning the SEC to make sure that HP wouldn’t get in trouble for ignoring it.
5. Cut the cord from Lane. Employees say they rarely see Whitman when she’s not “yucking it up” with Lane. “We need to hear form Meg on how much longer she needs Ray Lane working with her that closely and when she feels she can take it on her own,” advises Bloxham.