Procter & Gamble Co.’s directors are facing a time management challenge: monitoring Chief Executive Officer Robert McDonald’s turnaround plan while running their own companies.
Until Angela Braly resigned as WellPoint Inc.’s top executive last week, six of the 10 outside directors on P&G’s board were active CEOs, the highest number of any company in the Standard & Poor’s 500 Index, according to an analysis by GMI Ratings in New York. Now that Braly is no longer a CEO, P&G ties International Business Machines Corp. with five, GMI found.
So far P&G directors have kept up with board commitments, with 97 percent in attendance at seven board meetings and 23 committee meetings in the fiscal year ended June 30, 2012, according to regulatory filings. While a typical board seat requires about 20 hours a month of work, a company facing challenges can quickly consume more time, said David Larcker, a law professor at Stanford University.
In addition to Hewlett-Packard and Boeing, the public company CEOs on P&G’s board are the leaders of American Express Co., Archer-Daniels-Midland Co. and Frontier Communications Corp. McDonald, who is the board’s chairman, and four of the other CEOs are on at least one additional public board.
American Express CEO Kenneth Chenault leads the best-performing company among the chief executives on the P&G board. The biggest credit-card issuer by purchases reported a second- quarter profit in July that beat analysts’ estimates. The shares have risen 24 percent this year. Chenault, who joined the P&G board in 2008, is also on the board of IBM with McNerney.