Onboarding 'Mr. or Mrs. Activist' Director
The Agenda article, “Onboarding 'Mr. or Mrs. Activist' Director," quoted Russell Reynolds Associates Consultant
Rusty O'Kelley on adding and including opposing viewpoints in the boardroom. The article is excerpted below.
Restaurant chain and packaged food company Bob Evans Farms faced activist Sandell Asset Management for more than three years. A 2014 proxy fight, litigation spurred by Sandell that same year and another proxy fight threat in 2015 left the board battered.
However, directors there vowed to make the most of the situation after Sandell successfully installed four new directors to the board after the 2014 proxy fight. Ultimately, Post Holdings closed its acquisition of the company in 2018. Since then, Bob Evans’s profits are up 40%,according to an interview with Bob Evans CEO Saed Mohseni from Columbus Business First
Indeed, sources say holding on to bitter feelings or suspicions about directors’ motivations is not a good idea. Instead, incumbent directors should keep in mind that all directors on the board are working for all shareholders.
“They aren’t activist directors anymore, they are just directors,” says Rusty O'Kelley, co-leader of Russell Reynolds Associates’ board and CEO advisory partners and a senior member of the New York office.
Sources say it is important for directors to be open to frank discussions from the beginning. O'Kelley says it is important for the incumbent directors to provide the new director with the same information everyone else gets and to “spend the time to get to know them and make them feel like a part of the board.”
To read the full article, click here.