DETROIT -- Harry Wilson, the activist investor who last year prodded General Motors to buy back $5 billion in stock, says that GM’s recent move to make CEO Mary Barra board chairman was “remarkably tone deaf.”
During questions at the Automotive News World Congress, Wilson said Barra is “doing a great job as the CEO.”
But he added, “Being chairman of the board is a different job. Some people have characterized it as a promotion. It’s not a promotion -- it’s a different job.”
Wilson is both chairman and CEO of MAEVA Group, a suburban New York City boutique investment and corporate restructuring firm he founded in 2011. He was also a former member of the U.S. task force that restructured GM and Chrysler, and a self-styled champion of good corporate governance.
Raise, not new title
GM’s board named Barra, 54, its chairman on Jan. 4, nearly two years after she took over the CEO role from Dan Akerson. Akerson held both titles when he retired from GM in January 2014.
At the time GM expanded Barra's role to include chairman, Theodore "Tim" Solso, immediate past chairman and the new lead independent director, said "the board concluded it is in the best interests of the company to combine the roles of Chair and CEO in order to drive the most efficient execution of our plan and vision for the future."
Wilson said it would be more appropriate to give Barra a raise for her “great job” as CEO. “I’d be in favor of that,” Wilson said. “I think to get the best out of the board, the chairman should be incredibly engaged in maximizing the knowledge base of the board members. That is a distraction, in my opinion, for Mary.”
During his prepared remarks, Wilson said companies are best served by having five things: good products, good corporate governance, the right goals, the right incentives, and the right people.
“If the last seven years has taught us anything, it’s that any business can fail,” Wilson said. And the reason they fail is usually because one or more of the five things he listed is neglected or ignored.
Wilson said companies and their shareholders are best served by management and corporate boards which are focused more on the quality of their products and the character of their employees than on quarterly profits.
He said corporate officers need to be “long-term greedy” with their companies, which he defined as making decisions that are in the best interest of their companies and products over the long term, even if it means short-term pain.
Wilson is a director of Visteon Corp. and Sotheby’s. He has a bachelor’s degree in government from Harvard College and an MBA from Harvard Business School.