SAN FRANCISCO, March 11 Hewlett-Packard Co's
lead independent director defended Chairman Ray Lane and
two fellow board members on Monday, contesting a recommendation
from proxy adviser ISS that shareholders oust them for their
role in the mis-managed acquisition of Autonomy Plc in 2011.
In a detailed letter to shareholders on Monday ahead of the
company's annual general meeting, Rajiv Gupta said the board has
laid a solid foundation for HP's turnaround and warned that
ejecting longtime directors would de-stabilize the company.
"Losing some of our directors in an abrupt and disorderly
manner could undermine our efforts to stabilize the company,"
Gupta, a former CEO of specialty materials maker Rohm & Haas
, wrote on Monday. "What the company needs now is
stability and consistency of leadership so that the Board and
the management team can devote all of their focus and energy
towards executing on our strategic plan."
HP CEO Meg Whitman is trying to revive a company once
synonymous with Silicon Valley but fell on hard times in a
contracting personal computing market, by re-focusing the
sprawling corporation on enterprise computing services.
Gupta did not address the Autonomy angle in his letter, but
outlined the credentials of all three men that leading proxy
adviser ISS recommended against. In particular, he highlighted
Lane's global and management experience as former Chief
Operating Officer of software giant Oracle Corp.
Leading proxy adviser ISS, closely followed by investors
seeking guidance on controversial issues, last week suggested
voting against Lane, a managing partner at high-powered Silicon
Valley venture capital firm Kleiner Perkins. They also gave
fellow board members John Hammergren and G. Kennedy Thompson the
Thompson was formerly chairman and CEO of Wachovia Corp, the
North Carolina bank bought by Wells Fargo & Co in 2008.
And Hammergren is chairman and CEO of U.S. drug wholesaler
The same day, Glass Lewis - another proxy firm, recommended
shareholders vote to remove four directors - venture capitalist
Marc Andreessen and Gupta, along with Hammergren and Thompson.
Both firms blamed the directors for inadequate due diligence
relating to the acquisition of Autonomy. HP, which acquired the
British firm for $11.1 billion, took a massive writedown on its
value last year and accused former Autonomy executives,
including then-Chief Executive Mike Lynch, of accounting fraud.
Lynch has denied the allegations. Gupta on Monday repeated
HP's official recommendation that shareholders vote to re-elect
all current directors.
The recommendation against Lane marked one of the few
"special cases" in which ISS has advised shareholders against
re-electing the chairman of the board.
In 2012, it recommended against Wal-Mart Stores Inc
Chairman Robson Walton and other directors for failing to fully
investigate allegations of widespread bribery by company
officials in Mexico.
And in 2009, ISS advised shareholders to vote against
re-electing Bank of America Chairman Ken Lewis,
following its costly acquisition of Merrill Lynch.