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More Board Slots for HR?

Saturday, December 1, 2007
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David Pace, executive vice president of partner resources for Seattle-based Starbucks, says he hears a lot of vague talk about the need to put HR executives on corporate boards. This does not seem to be happening, however.

Why not?

University of Southern California's Ed Lawler believes the answer lies partly in ignorance. CEOs, who tend to have a lot of influence over criteria for board-member selection, "don't know what they don't know" about HR, he says. Plus, they and other board members tend to be confident that they've got that base covered.

"When I've interviewed CEOs and board members and asked them who they rely on for [HR expertise], they'll usually say, 'We have Joe Smith who is CEO of XYZ Corp., and he really understands the people side of organizations.' "

And perhaps "Joe Smith" once did a stint in the HR trenches. Jeff Cunningham, chairman and CEO of NewsMarkets, publisher of Directorship magazine, and lead director of Cambridge, Mass.-based Sapient Corp., a consulting company that helps companies upgrade their marketing and technology strategies, surmises that some active or retired CEOs serving on boards today may have been in HR "at one time" in their careers, prior to moving up to the top of the ladder, and then became better known for their subsequent experience than for their accomplishments "during their middle-management phase."

In addition to Starbucks' Olden Lee, another notable exception in the boardroom is Coleman H. Peterson, the former HR chief of Wal-Mart Stores Inc. who currently sits on the boards of J.B. Hunt Transport Co. and Build-a-Bear Workshop.

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Peterson is confident that people who did a stint in HR have a lot to offer to the board. He notes that among the key responsibilities of board members are hiring, evaluating, compensating and occasionally firing CEOs. "All four of these functions are grounded in HR skills and competencies," he says.

His own theory about why full-career HR professionals are rarely seen on large company boards is that many CEOs just want to recreate the board in their own image, seeking out retired or sitting CEOs. That suggests corporate boards won't begin to see a major infiltration by people with substantial HR expertise until more HR executives move from the company's top HR job to the CEO slot.

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