Taking Spouses on Board Trips is "Educational and Enjoyable"
from
September/October 2007
by Lois Gilman
For most of your career, your spouse has put up with the long hours you’ve devoted to getting ahead in your day job. The additional demands of your board duties probably push that patience even further, particularly when they take you to exotic, faraway spots like China. So it seems only fair that some companies occasionally invite their directors’ spouses to join them—and pick up the airfare, hotel, and side trips. Those that do include Chiquita Brands International, ConocoPhillips, DuPont, FedEx, ITT Corp., Moody’s Corp., and Wal-Mart Stores.
The wives and husbands who take these trips get to see for themselves some of the overseas projects that have sopped up so much of their significant others’ time, and finally meet the people they’ve been hearing about for so long—often the mysterious folks at the other end of
wee-hour conference calls. Last September, for example, specialty-materials maker Rohm & Haas of Philadelphia took board members and some of their spouses on a five-day trip to Shanghai. Among other things, the group attended the dedication of the company’s new research and development center, met for a formal lunch with local movers and shakers—who brought their spouses too—visited museums, and went on a daylong bus trip to see the famed historical gardens in Suzhou. “The trip was so distinctive and so useful. It helped us all understand some of the strategic directions the company was going,” says Martha Darling, whose husband, Gilbert S. Omenn, 65, a professor of internal medicine, human genetics, and public health at the University of Michigan, is a longtime member of the Rohm & Haas board.
Morton L. Topfer, 70, a director of the Silicon Valley semiconductor maker Advanced Micro Devices, cites the same benefits. Last year he and his wife, Bobbi, joined other board members and their spouses for a trip to Dresden, Germany, to help AMD celebrate 10 years of doing business there. “The visit gave the spouses the opportunity to learn more about the company,” says Topfer, managing director of Castletop Capital, a private investment firm in Austin, Texas, and a former vice chairman of Dell. “It’s very difficult for them to understand what’s going on unless they get some exposure. And it gives them a better understanding of why we’re on the phone every week doing a conference call and why we go to board meetings five times a year.”
John Horn, 65, got a closer look at Eli Lilly & Co. and the work its board does when he accompanied his wife, Karen N. Horn, 63, senior managing director of New York City’s Brock Capital Group and a Lilly director, on a board-and-spouses trip to Toronto last year. The program included a talk by another director, Alfred G. Gilman, winner of the 1994 Nobel Prize in Physiology or Medicine. His description of how drugs work in the body fascinated Horn, a retired professor of statistics and marketing. “It’s very nice to know what’s going on at Lilly,” Horn says. “There are several boards that Karen is on that don’t have events that include spouses. I don’t have nearly the same kind of feeling for exactly what Karen’s doing with them. I’d welcome the chance to find out more.”
Spouses who know what a company is doing can act as goodwill ambassadors too, says Curtis J. Crawford, 60, chief executive of the Santa Clara, California, outfit XCEO, which offers executive mentoring programs, and a director of DuPont and ITT, among other companies. “The better the directors’ spouses are educated about what goes on with the company, the better they can articulate the value that the company delivers to its customer base,” he says. Crawford’s wife has joined him on trips to China and Japan on behalf of the DuPont board, and to Sweden for ITT. “When my spouse speaks about DuPont and ITT today, she speaks much more eloquently about the companies than she could prior to being engaged in the board activities,” says Crawford. “And she certainly has a vested interest and responsibility to be a very strong supporter of the firms.”
William K. Reilly, 67, founding partner, president, and CEO of Aqua International Partners, now part of the Texas Pacific Group buyout firm, and a director of ConocoPhillips, DuPont, and Royal Caribbean, sees another payoff. “It’s extremely useful to know your fellow directors, and knowing their spouses is one of the best ways to do that,” he says. His wife, Elizabeth, has accompanied him on a number of board trips, including
one with ConocoPhillips this year to Sea Island, Georgia. Roderick M. Hills, 76, founder and chairman of the Hills Governance Program
at the Center for Strategic and International Studies and a former chairman of the Securities and Exchange Commission, talks about the same benefit. “You learn more about a director if you’re in a social setting with his or her spouse,” he says. “You have a chance for a broader discussion.” He should know, having viewed the experience from both perspectives. He’s served on some 20 boards, most recently Chiquita’s, which last year invited directors and their spouses to an off-site in Pebble Beach, California. Hills, who retired from the Chiquita board in May when he hit its age limit, has also been the traveling spouse. His wife, former U.S. trade representative Carla A. Hills, 73, has served on several boards, including Chevron’s, where she was lead director until she stepped down last year. She’s currently on the board of Gilead Sciences, a biopharmaceutical company in Foster City, California.
Overseas board trips aren’t necessarily wall-to-wall fun. In Dresden, AMD’s representatives sat through speeches by German politicians and local dignitaries. DuPont’s Shanghai trip included a ribbon-cutting, and the Japan stop a visit to a Toyota factory. In 2005 Wal-Mart took its directors and their spouses to Puerto Rico, where the schedule included visits to local Wal-Marts, peeks inside rival stores, and an invitation to comparison-shop.
Some directors believe the friendships formed among spouses when they travel help the board members work better together once everybody gets home. “Over the past 20 years, relationships among board members have become much more informal,” says Karen Horn, who has served on the Lilly board since 1987. “That’s been valuable for having very different kinds of discussions.” Horn is also a director of Fannie Mae and Simon Property Group, neither of which has taken the two Horns on board trips. That is something she’d clearly like to change. “I believe that a best practice for boards of directors is to have informal interactions as well as formal ones,” she says. “Occasional meetings in which spouses are included are one form of informal interaction.”
American Electric Power, a Columbus, Ohio, utility, has formalized just such a program. It invites directors’ spouses to the board’s annual strategic planning meeting, an event that extends over several days. “We’ll have two or three dinners where we rotate the seating and people get to interact,” says director Lester A. Hudson Jr., 68, a professor at the McColl Graduate School of Business in Charlotte, North Carolina. Last year AEP’s directors and their spouses, including Hudson’s wife, visited the Greenbrier Resort in West Virginia. Says Hudson: “The effectiveness
of a board depends upon the individual respect and the relationships and collegiality among the directors. If you are going to be away for several days, it helps to have spouses there. It’s important to get people away from their usual environment and into an informal setting where they can concentrate on an issue and come back to it several times during the meeting. Ideas come up, and those things are very important.” Like others interviewed for this story, Hudson emphasizes that spouses are not present when the directors discuss company business.
Companies that don’t invite spouses along on board trips may be missing something. “It’s very difficult for a member to serve on a public-company board and do it well if his or her spouse is negative about it, is critical about it, doesn’t understand it, doesn’t know the people involved, and is insensitive to the fiduciary obligation of his wife or her husband who serves on that board,” says Nashville attorney Aubrey B. Harwell Jr., 65, a director of Piedmont Natural Gas in Charlotte, North Carolina. The company periodically invites spouses to off-site strategic planning meetings, and, says Harwell, “my wife will change her plans when I notify her of the date. She’s developed bonds with the other spouses and with spouses of the management team. It’s educational and it’s enjoyable.”
