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Patti Hart will not seek re-election
Thursday, May 10,2012 : IGT CHIEF LEAVES YAHOO BOARD
Patti Hart in row over Yahoo CEO's academic qualifications
IGT chief executive officer Patti Hart, who is also a director on the Yahoo board, has indicated that she will not seek re-election following a row over her role on a Yahoo committee that hired chief executive Scott Thompson to run the search engine giant.
Questions were subsequently raised by investors regarding Thompson's qualifications, and there are now calls for him to depart, according to widespread media reports.
Investor Third Point LLC, which has alleged that Yahoo is being mismanaged, disclosed the discrepancy in Thompson's credentials last week, claiming that his biography falsely said he held a degree in computer science. That triggered an enquiry into the matter by a committee of three appointed by the board of directors at Yahoo.
The company will report on the committee's findings when these have been reached, a company statement said, moving away from Yahoo's original assurances that characterised the discrepancy as an “inadvertent error” and said it “in no way alters that fact that Mr. Thompson is a highly qualified executive with a successful track record leading large consumer technology companies.”
Colin Gillis, an analyst at BGC Partners in New York opined: “This was a flawed process. What’s happening is that Third Point’s case - that the board is not functioning effectively - has been strengthened.”
Thompson came to Yahoo in January this year from Ebay subsidiary PayPal, replacing Carol Bartz, who was dismissed in September amid falling sales and market-share losses.
Third Point CEO Daniel Loeb also questioned Hart's academic credentials, prompting IGT chairman Philip Satre to weigh in with a statement Tuesday revealing that IGT directors had conducted a review and found “no material inconsistencies” in Hart’s academic credentials.
Satre said: "After a thorough review, the IGT Board of Directors has found no material inconsistencies in Patti Hart's academic credentials. The Board unanimously stands behind Patti as our CEO and fully supports her leadership and the direction she has set for the Company.
“Furthermore, we believe her service as a member of Yahoo!'s Board of Directors could become a distraction from her responsibilities to IGT. We have asked Patti not to seek re-election to the Yahoo! Board and we will closely monitor future developments at Yahoo! and their impact on Patti's responsibilities to IGT."
Hart has therefore decided to leave the Yahoo board, giving her reasons in a statement alongside that of her chairman's:
"After careful consideration, I have decided not to stand for re-election to the Yahoo! Board of Directors at the upcoming annual meeting of stockholders. It has been my privilege to serve Yahoo! stockholders and I remain confident in the Company's future.
“However, my primary responsibilities are to serve as Chief Executive Officer of IGT and to eliminate activities that may interfere with my ability to carry out my commitments to IGT and its valued stakeholders."
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