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Board members come under fire from shareholders all the time over their fiscal responsibilities but now there's a new battle brewing in the boardroom: Social issues like gay rights.
When activist investor Carl Icahn recently took on Chesapeake Energy over allegations of misuse of company funds by CEO and Chairman Aubrey McClendon, the company acted quickly, announcing McClendon would be stripped of his chairman title and agreeing to replace four board members.
How the board manages a company’s money is of direct interest to shareholders. But how important is it for a board member to agree with a company’s policies on social issues if they are going to sit on the board? Will a contradiction have broader implications for clients, customers, and shareholders of both organizations?
The CEOs of telecom giant AT&T and accounting firm Ernst & Young find themselves in a unique position: Both CEOs and their companies have a strong record on supporting lesbian, gay, bisexual, and transgender (LGBT) rights. Both companies have recently issued statements in support of gay rights. But both CEOs sit on the board of the Boy Scouts of America, which has a policy that doesn’t allow individuals who are openly gay to be members or serve as Scout leaders.
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