Should corporations like Apple forego the benefits of board members beholden to other corporations that operate within the same industry?
At a town hall meeting shortly after introduction of Apple’s iPad tablet computer, former CEO, and Chairman, Steve Jobs reportedly said:
“[Apple] did not enter the search business. [Google] entered the phone business. Make no mistake they want to kill the iPhone. We won’t let them. He reportedly continued to say: “This don’t be evil mantra” [Google’s informal motto], “It’s bullshit.”[i]
Many corporations have Directors that are on several boards or are high-level executives of other corporations or both. For example, Paul Otellini is president and chief executive officer of Intel and currently sits on Google’s board of directors. Dan Mead is chief executive officer of Verizon Wireless, a member of the Board of Directors and an officer of CTIA, the wireless industry trade association. Also, Mead is on the Board of ISIS, an emerging mobile commerce company. Tom Ryder a director at Amazon since 2002, was director at Virgin Mobile from 2007 to 2009. Inevitably, these companies are sometimes in the same industry or operate within the same sphere. As a new industry becomes particularly sought after – such as mobile telecommunication/mobile computing, or entry into this industry becomes necessary for the survival of a particular company, these same corporations can become direct competitors. This can lead to corporate fall-out between company ‘big-wigs,’ not including the larger problem of creating a board that may at some point operate outside the best interest of the corporation.Read More