During this holiday season, some of us at The Motley Fool decided to help Santa Claus put together his annual "naughty and nice" list. Although Santa needed our list in by today, I hope he's able to accommodate a few more naughty late arrivals before his midnight run later this month.
Just in case Santa can't, I'm tossing in Hewlett-Packard's
Topping the naughty list is Patricia Dunn, the now ex-chairman of HP's board. The illegal practice of pretexting -- in which HP, in searching for the leak, gained access to other people's personal records under false pretenses -- occurred under her watch. Also on the list: George Keyworth, who is believed to be the source for the leaked information. Leaking information might be legal, but it's still naughty. I admit that some directors were probably less naughty than others, and maybe Tom Perkins should get a free pass, but as the saying goes, it only takes one bad apple to spoil the barrel.
And if you don't think my bad-apple theory is appropriate, look who just got back into the hot seat -- CEO Mark Hurd. He'd managed to stay above the fray until this week. It turns out that Congress is looking into the CEO's exercise of 100,000 options, less than two weeks before HP's disclosure of its pretexting issues. The timing implies that he could have traded on material nonpublic information, which is naughty with a capital N.
The corporate boardroom will always be a source of naughtiness and niceness. And as the number of independent directors on corporations' boards increases, the tension to play fair will only increase. A chummy board of directors playing nice and rubber-stamping management's desires doesn't work. Just look at some of the recent outrageous CEO payouts at Exxon
There's a whole world of naughty and nice out there! Take a look at the rest of the bunch.
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