May 9, 2012

Busted! Yahoo’s Resume Lies: How Much Should You Investigate a Director Nominee?

Recently, both Yahoo CEO Scott Thompson and a director who led the CEO search a few months ago that led to his hiring – Patti Hart – were outed by activist hedge fund manager Dan Loeb for lying on their resumes (the lies are in the company’s preliminary proxy statement too). As noted in this article, Yahoo’s CEO refuses to step down – although the director is leaving as noted in this Form 8-K (she is leaving at the request of the board where she serves as CEO per this Bloomberg article) and the board has formed a special committee to investigate as noted in these additional soliciting material. As mind-boggling as this is, I think lying on resumes is not as rare as you would think. And the ramifications can be huge – as can be seen from the ongoing Yahoo saga.

Which leads us to a related question: “Should a company dig pretty deep into a potential director nominee’s past before they are placed on the ballot?” This was an issue that was debated internally before I finalized my “D&O Questionnaire Handbook.” To be honest, I was surprised that background vetting of director nominees is not a standard practice today – so the response to that question on page 25 of the Handbook reflects current practice and not where I think the ball should be (or will end up perhaps after this Yahoo saga). But maybe I’m wrong. I’m curious to hear your thoughts…

If I were to falsify my resume, I would list my interests as “traveling, surfing & martial arts” and see how that played with the ladies…

The SEC Redesigns Its Home Page

Yesterday, the SEC rolled out a redesign of its home page. This is the first time the agency has overhauled its home page since the site was launched (there have been minor tweaks here and there). So far, the site’s underlying pages haven’t changed – including the important item of the URLs not changing (which would kill millions of links over the Internet if that happened). However, the site gradually changed during the day yesterday – so perhaps the full launch is not yet complete. Personally, I’m not a big fan of moving pictures on home pages (usability principle: gratuitous graphics can distract users from critical content).

Poll: What Do You Think of the SEC’s New Home Page?

Please take a moment to provide your opinion anonymously about the SEC’s new home page:

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– Broc Romanek