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September 6, 2006

HP: Confidentiality vs. Control

One final (I hope) comment on the HP board investigation. Dunn at HP is selling this all as being about confidentiality of boardroom discussions. Here is her statement to the WSJ:

The situation is regrettable. But the bottom line is that the board has asserted its commitment to upholding the standards of confidentiality that are critical to its functioning. A board can't serve effectively if there isn't complete trust that what gets discussed stays in the room."

I disagree. While confidential boardroom discussions are important, it's also important to be able to effect change in organizations through other channels. Making all change happen through the board -- as opposed to, say, bring public opinion or media pressure to bear -- is a narrow and naive view of an intensely political process.

More broadly, while the WSJ's Alan Murray buys some of this, and presents it as a change in the clubby world of corporate boards, I take a different view. This is less about board confidentiality than about executives' board control: And what better way to control your board than the constant Kafka-esque threat of a possible investigation hanging over your head?

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