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Apple restructures board in wake of Jerry York's passing

post #1 of 36
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Apple recently repositioned several of its board members to bring the company back into compliance with its own governance guidelines after the sudden death last month of long-time director Jerome York left a void in its leadership.

As first reported by The Wall Street Journal, Apple's website indicates that Avon Chief Executive Andrea Jung, a co-lead director, has been added to the company's audit committee and also appointed chair of the compensation committee, replacing Intuit Chairman Bill Campbell.

Her co-lead director, Genentech Chairman Arthur Levinson, now co-chairs the audit committee with Campbell that York had presided over for more than 12 years. Levinson also remains a chair person on Apple's Nominating Committee.

According to his wife Eilene, York collapsed at his Rochester, Michigan home this time last month and was transferred to Pontiac Osteopathic Hospital by emergency services. He passed away two days later as a result of a massive cerebral hemorrhage he suffered during the collapse.

The former chairman, president and CEO of Harwinton Capital, York joined Apple’s Board of Directors in 1997 when the company was in shambles. He is widely acknowledged for his contributions to the electronics maker during its turnaround, as he similarly was at both IBM and Chrysler, where he held the role of chief financial officer.



Apple has yet to name York's successor and the Journal notes that it's unclear whether it will do so. A person familiar with the matter told the paper that Apple "hasn't yet hired a search firm to fill Mr. York's vacancy and is more likely to tap personal connections to find a candidate, as it has in the past."
post #2 of 36
Quote:
Originally Posted by AppleInsider View Post

A person familiar with the matter told the paper that Apple "hasn't yet hired a search firm to fill Mr. York's vacancy and is more likely to tap personal connections to find a candidate, as it has in the past."

First piece of advice, fwiw: stay away from the US hardware/software industry.

Second piece of advice, fwiw: You are a global company. Put a non-US person on the Board. Send a signal. (My recommendation: Narayana Murthy; http://en.wikipedia.org/wiki/N._R._Narayana_Murthy).
post #3 of 36
Quote:
Originally Posted by anantksundaram View Post

First piece of advice, fwiw: stay away from the US hardware/software industry.

Second piece of advice, fwiw: You are a global company. Put a non-US person on the Board. Send a signal. (My recommendation: Narayana Murthy; http://en.wikipedia.org/wiki/N._R._Narayana_Murthy).

Why the particular candidate for recommendation?
Same Apple. Same Mac. Different Take. Different Place. http://Applemacness.com
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post #4 of 36
Quote:
Originally Posted by anantksundaram View Post

First piece of advice, fwiw: stay away from the US hardware/software industry.

Second piece of advice, fwiw: You are a global company. Put a non-US person on the Board. Send a signal. (My recommendation: Narayana Murthy; http://en.wikipedia.org/wiki/N._R._Narayana_Murthy).

Sounds like a bad idea. Is he going to teleconference all the meetings or fly in for them? Although Apple hires many people who have immigrated from India, they have very little presence in India. If they were to have a foreign board member (that is okay with the SEC right?), it would make more sense to have someone from China on their board.
post #5 of 36
Quote:
Originally Posted by esummers View Post

Sounds like a bad idea. Is he going to teleconference all the meetings or fly in for them? Although Apple hires many people who have immigrated from India, they have very little presence in India. If they were to have a foreign board member (that is okay with the SEC right?), it would make more sense to have someone from China on their board.

Apple computers are used by majority of people in Bollywood industry and seem as premium computer. A large number of graphic, artistic people use Apple. There are many retailers and Croma, the large Electronic store in india, a joint venture by TATA & Woolworth (Australia) have a full range of selection of Apple products, which appeal is growing very fast.

Not sure were you get your information from.

P.S. Narayana has houses and business in US, like many Indian companies/successful people and traveling is not an issue. He would work his schedule to fit necessary meetings like any good corporate businessman.

Here are some facts on Narayana http://www.infosys.com/about/managem...na-murthy.aspx
post #6 of 36
Quote:
Originally Posted by striker_kk View Post

Why the particular candidate for recommendation?

Did you have the chance to look at the link? Anyway, see below.

Quote:
Originally Posted by esummers View Post

Sounds like a bad idea. Is he going to teleconference all the meetings or fly in for them? Although Apple hires many people who have immigrated from India, they have very little presence in India. If they were to have a foreign board member (that is okay with the SEC right?), it would make more sense to have someone from China on their board.

Teleconference? Problem flying in for meetings? OK with the SEC? Quite apart from the fact that these are non-issues in a modern global corporation, Infosys is a $36B mkt cap, Level 3 ADR, listed on the NASDAQ (http://www.google.com/finance?client=ob&q=NASDAQ:INFY). It is commonly acknowledged to be one of the great companies of the world.

It had nothing to do with the fact that the guy is Indian. He is non-US, well-known, and widely respected globally. That aside, I was simply looking for someone who is a visionary, out-of-the-box, socially-conscious, ethical, superbly intelligent, entrepreneur/leader who understands cross-border business, and his name came to mind.

Do you have any suggestions from China (or elsewhere) that fit the bill? If so, please suggest them.
post #7 of 36
Apple should appoint Tim Cook to the Board. To recognize his contributions to the company.
post #8 of 36
Quote:
Originally Posted by anantksundaram View Post

First piece of advice, fwiw: stay away from the US hardware/software industry.

Second piece of advice, fwiw: You are a global company. Put a non-US person on the Board. Send a signal. (My recommendation: Narayana Murthy; http://en.wikipedia.org/wiki/N._R._Narayana_Murthy).

Intriguing suggestions. I like the idea of someone who has a more international perspective. I'd prefer the person to be an American citizen with an international background, but I have no specific people in mind.

I wonder if it would be useful to have someone on the board with telecom experience?
post #9 of 36
Quote:
Originally Posted by AppleGreen View Post

Apple should appoint Tim Cook to the Board. To recognize his contributions to the company.

That's an interesting idea, but shouldn't a board be comprised of people in related areas that would help in making decisions about growing the business in new directions? I think Cook is a supremely competant person, but I'm more intrigued with the idea of a telecom person on their board... How about Craig McCaw?

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post #10 of 36
Quote:
Originally Posted by SpamSandwich View Post

That's an interesting idea, but shouldn't a board be comprised of people in related areas that would help in making decisions about growing the business in new directions? I think Cook is a supremely competant person, but I'm more intrigued with the idea of a telecom person on their board... How about Craig McCaw?

Yeah, a Board seat is not a 'reward' for competent management. The role of the Board is to provide oversight over management.

I am not thrilled about a telecom person on the Board. It is a luddite industry with yesterday's business model and zero innovation.

Arguably, one of reasons that Apple is so successful is because they did not adopt a 'telecom mindset' when they got into the industry.
post #11 of 36
Elon Musk
post #12 of 36
Quote:
Originally Posted by AppleGreen View Post

Apple should appoint Tim Cook to the Board. To recognize his contributions to the company.


On March 15, 2010 Tim received $5 million cash bonus and 75,000 shares of restricted stock.
http://tech.fortune.cnn.com/2010/03/...arthly-reward/

And less than 2 weeks later, he sold stock grants worth $68.8 mil.
http://tech.fortune.cnn.com/2010/03/...illion-shares/

How much more recognition does he need?

Also, Board of Directors are supposed to have independence from the company. Cook's financial ties would compromise that independence.
post #13 of 36
Quote:
Originally Posted by anantksundaram View Post

First piece of advice, fwiw: stay away from the US hardware/software industry.

Second piece of advice, fwiw: You are a global company. Put a non-US person on the Board. Send a signal. (My recommendation: Narayana Murthy; http://en.wikipedia.org/wiki/N._R._Narayana_Murthy).

Nothing impressive me less than India's cap on salaries and his listing of only $50k per year as a founder of a multi-billion dollar corporation. I'd be more impressed if it said $1 or actual compensation, but it's clear he's got his money like most Hindus--filtered out over many areas to keep below their tax ceiling.

A services company known as a head shop to professional consultants in the US is the last place Apple will draw from when looking for a board member.

Apple will not go abroad for it's board.

They will draw from within blue chip companies domestically. I'm surprised no mention of Disney's CEO, Robert Iger.
post #14 of 36
Quote:
Originally Posted by mdriftmeyer View Post

.... it's clear he's got his money like most Hindus--filtered out over many areas....

Nice bit of religious/ethnic slamming/stereotyping there, buddy. Hope you got your kicks for the day. (Sounds like someone whose job may have got outsourced).

Quote:
Originally Posted by mdriftmeyer View Post


They will draw from within blue chip companies domestically. I'm surprised no mention of Disney's CEO, Robert Iger.

Yeah, and appoint Mickey Mouse as chief corporate spokesman. No wait, there's Goofy......
post #15 of 36
Narayana Murthy, Tim Cook and Elon Musk all have strong points and would bring interesting talents to the party.

Murthy and his family have truly global connections and perspective. One daughter and her husband are Stanford grads with financial experience in Silicon Valley and London. Murthy is semi-retired and on advisory boards at Harvard and Yale, and probably would have no difficulty serving actively on the Apple board. His business experience is simply sterling.

Let's face it - while Jobs has been out front - Tim Cook has been behind the curtain pulling so many of the levers that have inspired Apple's recent gains. Adding him to the board now would put him out front as Steve's de facto successor and provide some necessary seasoning. Certainly at some point Apple will need another top inside guy as a director. The only question is when.

Elon Musk is an innovator - having founded PayPal and Tesla Motors. He's the youngest of the group and would be a big idea source and a spur perhaps to fresh ventures. A South African native, his is another family with global connections, and he is a dual threat with strong educational credentials in economics and physics.

But the loss of Jerry York's financial acumen leaves a big gap not completely filled by any of the other current directors or the aforementioned suggestions, despite their considerable talents. One could say that Apple is sitting on an embarrassment of financial riches at the moment. First and foremost, it seems, they need a real money and finance expert with a solid track record to offer counsel on when and how best to deploy Apple's resources without costly mistakes that only squander the shareholders' wealth.

So first get a money maven on board. There's nothing to say that the board size has to remain at six, so an additional member or two may be warranted without it becoming bloated.

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post #16 of 36
*
Bring back Avie. Seriously.

Quote:
Originally Posted by anantksundaram View Post

Yeah, and appoint Mickey Mouse as chief corporate spokesman. No wait, there's Goofy......

Sorry, Steve Ballmer already has a job.

Which reminds me: DO NOT bring in a sales guy.
Apple surely knows better, but I thought I'd throw out a little reminder.
post #17 of 36
Quote:
Originally Posted by mdriftmeyer View Post

They will draw from within blue chip companies domestically. I'm surprised no mention of Disney's CEO, Robert Iger.

I doubt Apple wants to set up an interlocking directorate with Disney, since they already aroused the attention of the SEC over Schmidt and Levinson being on Google's board.
post #18 of 36
Quote:
Originally Posted by quinney View Post

I doubt Apple wants to set up an interlocking directorate with Disney, since they already aroused the attention of the SEC over Schmidt and Levinson being on Google's board.

Steve Jobs already sits on Disney's board and is its largest individual shareholder.
post #19 of 36
Quote:
Originally Posted by Magic_Al View Post

Steve Jobs already sits on Disney's board and is its largest individual shareholder.

Exactly my point. It would look bad for Apple to add Disney's CEO to their board.
post #20 of 36
I'm going to go with Shantanu Narayen.

He's from India and used to work at Apple.

Do it as part of the overall Adobe merger.
post #21 of 36
Quote:
Originally Posted by quinney View Post

Exactly my point. It would look bad for Apple to add Disney's CEO to their board.

They serve different industries and if there was ever to be a controversy it's not Iger people would be concerned with, but Steve being on Disney's board while being the single largest share holder.

Iger, if he has any Apple stock, is no where near the top of the list of Apple's largest share holders.
post #22 of 36
One that screams, ``I've got all the talent you could ever dream of and could expand Apple to new areas and dominate the consumer world''

is

TED TURNER: http://en.wikipedia.org/wiki/Ted_Turner

Ted's talking of late about buying out CNN and cleaning house.

He's a proven winner.
post #23 of 36
Quote:
Originally Posted by Sour Apple View Post

Also, Board of Directors are supposed to have independence from the company. Cook's financial ties would compromise that independence.

That's not true. Boards of directors are often composed of people from the very company on whose board they sit.

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post #24 of 36
Quote:
Originally Posted by mdriftmeyer View Post

Nothing impressive me less than India's cap on salaries and his listing of only $50k per year as a founder of a multi-billion dollar corporation. I'd be more impressed if it said $1 or actual compensation, but it's clear he's got his money like most Hindus--filtered out over many areas to keep below their tax ceiling.

A services company known as a head shop to professional consultants in the US is the last place Apple will draw from when looking for a board member.

Apple will not go abroad for it's board.

They will draw from within blue chip companies domestically. I'm surprised no mention of Disney's CEO, Robert Iger.

You know nothing about their tax system in India, If you did you would know that 50K puts you in higher tax bracket. You need to be earning less than ~22K to stay out of that high tax bracket. Please before you write anything about a country outside your own get your facts right and not from your tabloid coverage from your living room.
post #25 of 36
I just hope that whoever they choose will help push them to clean up Apple Japan; it's a mess and their sales here could be much better than they are (which would benefit stockholders of which I am not). Sadly, I think recent moves (sloppy, at best) by Apple Japan will only reduce sales for some time to come and ultimately look bad for Apple as a whole.

 

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post #26 of 36
Quote:
Originally Posted by SpamSandwich View Post

That's not true. Boards of directors are often composed of people from the very company on whose board they sit.

That's correct. However, the best governance model which protects shareholders interests is a board which has a combination of executive and non-executive directors. Best practice usually has non-executive's comprising the majority.
post #27 of 36
Quote:
Originally Posted by souliisoul View Post

You know nothing about their tax system in India, If you did you would know that 50K puts you in higher tax bracket. You need to be earning less than ~22K to stay out of that high tax bracket. Please before you write anything about a country outside your own get your facts right and not from your tabloid coverage from your living room.

Last time I checked 300,000 Rubies was a cap. With 50% of your salary going to straight taxes many a person of affluence distributes their wealth amongst various relatives to surpass that ceiling. Several Hindu friends are my sources of information.

$50,000 USD == 2,212,500.00 INR

Tax brackets for India: http://finance.indiamart.com/taxatio...tax/rates.html

Amazingly, his taxable income falls just below him getting taxed more heavily:

* From now onwards there will be only 2 pages in the IT filing form for individuals.

* More cases can now be appealed against.

* Rs. 20,000 tax exemption will be provided for investments in certain investment bonds. This is in addition to the already allowed exemption (Rs. 1,00,000) in certain savings instruments.

* Tax Exemption will be given for contribution to the Central Government Health Scheme (CGHS).

* New fields have been added to the e-TDS/TCS form. These new fields are Ministry name; PAO / DDO code; PAO / DDO registration no.; State name; and Name of the utility used for return preparation.

Just like in America, you funnel your assets to your next of kin and your investments to keep yourself from having to pay more of your wealth, that one has mainly accumulated from the system designed to gain fractions of a % from everyone in labor under them.

It's just life.
post #28 of 36
Quote:
Originally Posted by SpamSandwich View Post

That's not true. Boards of directors are often composed of people from the very company on whose board they sit.

Exactly, which is why corporate governance is so shoddy these days.

The board is the board and management is management.

Also, Tim Cook is overrated. He is superbly competent as an operations guy, but he is not a product guy at all. He simply lacks the background or, frankly, the interest. He kept using a Blackberry long after the iPhone came out. He is all about efficiency, not elegance or aesthetic.

Steve Job's role was never to keep the trains running on time, which is what Cook does. If he is gone, the hole that has to be filled is completely different; it's the guy who sees five years ahead. It's also the guy willing to pay extra for the best engineering talent. That simply is not Cook.

I see no successor right now. If there was one, Jobs would lock horns with the guy over a disagreement about some pixel somewhere, and fire him. This may already have happened for all we know.

The succession is definitely a non-trivial problem.
post #29 of 36
Quote:
Originally Posted by quinney View Post

Elon Musk

At least from the people mentioned here, Musk is the most interesting choice for the board, on multiple grounds.
post #30 of 36
Quote:
Originally Posted by anantksundaram View Post

First piece of advice, fwiw: stay away from the US hardware/software industry.

Second piece of advice, fwiw: You are a global company. Put a non-US person on the Board. Send a signal. (My recommendation: Narayana Murthy; http://en.wikipedia.org/wiki/N._R._Narayana_Murthy).

So upon first reading this sounded like a bad idea. I work daily with Wipro, an Infosys competitor, and the mindset could not be further from what I think of as Apple core values.

Narayana does have a good speech though. Literally, as I just read his NYU speech and I thought it was both insightful and carefully thought out.

But still, as much as I want Apple to be more responsive to global needs and I respect Narayana, I don't want Apple to outsource talent. It's already bad enough that all manufacturing is outsourced to China.

Narayana would likely push for further outsourcing, and of engineering. But Apple engineering and design would suffer greatly as a result. Not because I think there are no Indians with equivalent talent, but because you would be breaking up consolidated engineering teams that currently exist, wasting precious years in useless turmoil, stress, and cultural adjustments.
post #31 of 36
Quote:
Originally Posted by benice View Post

That's correct. However, the best governance model which protects shareholders interests is a board which has a combination of executive and non-executive directors. Best practice usually has non-executive's comprising the majority.

Agreed. Confer a substantial amount of restricted stock on one or two top managers and make them board members. Wealth generation through ownership influences management behavior. It emphasizes the primacy of shareholder interests in aligning the operational strategy and direction of the business.

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post #32 of 36
Quote:
Originally Posted by Alonso Perez View Post

Exactly, which is why corporate governance is so shoddy these days.

The board is the board and management is management.

Also, Tim Cook is overrated. He is superbly competent as an operations guy, but he is not a product guy at all. He simply lacks the background or, frankly, the interest. He kept using a Blackberry long after the iPhone came out. He is all about efficiency, not elegance or aesthetic.

Steve Job's role was never to keep the trains running on time, which is what Cook does. If he is gone, the hole that has to be filled is completely different; it's the guy who sees five years ahead. It's also the guy willing to pay extra for the best engineering talent. That simply is not Cook.

I see no successor right now. If there was one, Jobs would lock horns with the guy over a disagreement about some pixel somewhere, and fire him. This may already have happened for all we know.

The succession is definitely a non-trivial problem.

Outstanding post there! Very insightful. I agree with your assessments 100%.
post #33 of 36
Quote:
Originally Posted by Alonso Perez View Post


Narayana does have a good speech though. Literally, as I just read his NYU speech and I thought it was both insightful and carefully thought out...... I respect Narayana, I don't want Apple to outsource talent. It's already bad enough that all manufacturing is outsourced to China.......Narayana would likely push for further outsourcing, and of engineering.......

This I do not agree with at all. If you think the guy is just about a good speech and outsourcing, that's a bit of a shallow assessment.

Also, in what way is Apple's outsourcing to China 'bad enough?' Just because you dislike outsourcing, or because you think the quality is poor? If the former, you need to think about why outsourcing happens. If the latter, which Apple product do you think suffers from inferior quality because it is manufactured in China?

Also, do you have any valid data to show that production in places such as the US is uniformly better? (For example, Toyota's much-vaunted problems recently were from parts manufactured in the US, by a US company).
post #34 of 36
I nominate.....


ME!
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post #35 of 36
Quote:
Originally Posted by justflybob View Post

I nominate.....


ME!

The nomination is...... rejected. Sorry Bob, nothing personal.

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post #36 of 36
Quote:
Originally Posted by anantksundaram View Post

This I do not agree with at all. If you think the guy is just about a good speech and outsourcing, that's a bit of a shallow assessment.

...

Also, do you have any valid data to show that production in places such as the US is uniformly better? (For example, Toyota's much-vaunted problems recently were from parts manufactured in the US, by a US company).

So, first of all, the guy is certainly about outsourcing. This is what Infosys does, and what he dedicated his career to. Now, there is nothing wrong with that, as far as Infosys goes. If they found a market for their services, more power to them.

But I don't think it's a good model for Apple.

The second issue, about China, has nothing to do with quality. I did not mention quality, did I? Why are you assuming? There are plenty of other criteria:

1. Chinese labor conditions with workers who have little legal protection. Need I remind you that unlike India, China is a police state run by an authoritarian regime? I don't want my dollars feeding that.

2. Chinese energy sources are dirty, and since air freight is typically used due to time to market issues, the carbon footprint of products made there is higher than it would be otherwise.

3. Besides CO2, Chinese environmental controls are lax to say the least, since there is little public accountability, so solvents and other toxic chemicals used in manufacture are dumped into rivers or leach into ground water. I don't want my dollars doing that, either.

4. China is manipulating its currency and that is costing jobs not just in the US, but also in Europe, Japan, and Korea. Anywhere, in fact, where salaries allow a decent standard of living.

I am all for India making progress. It is a democracy and a big one. It has a fascinating culture, wonderful food, and some really top talent (and also, like everywhere, plenty of mediocre talent too).

But I'd rather its top talent came up with its own Apples. I think Tata is a far more interesting company than Infosys, for example.

Don't get me wrong. I respect Infosys, but sort of in the way I respect Dell; not for creativity, but for the able building of a large company from scratch, led by its founder.

To illustrate my point, I would not put Michael Dell on Apple's board either.
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