Companies

HP criticised over handling of director resignation

The US Securities and Exchange Commission (SEC) has censured Hewlett-Packard, the computer company, for failing to disclose the reasons for a director’s abrupt departure.

Thomas Perkins resigned from the HP board in May 2006, in the midst of HP’s controversial investigation into boardroom leaks to the press. The SEC found Perkins objected to the way the investigation was being conducted and resigned from the board during a “lengthy and heated” board meeting, but HP failed to disclose the reasons for his resignation as required by federal securities laws.

Linda Thomsen, director of the SEC’s division of enforcement, said: “The federal securities laws exist to ensure transparency, and investors have a right to know when a dispute among board members over operations, policies or practices causes a director to resign, as such a dispute may have far-reaching ramifications for the company”.

HP, without admitting or denying the SEC’s findings, consented to a cease and desist order.

June 2007