Cisco's CEO to Join BlackRock's Board -- Update
April 05 2017 - 6:22PM
Dow Jones News
By Joann S. Lublin and Sarah Krouse
BlackRock Inc. has nominated Cisco Systems Inc. leader Chuck
Robbins as a director, making him the first technology chief
executive on the board of the world's largest money manager.
The expected election of Mr. Robbins at BlackRock's May 25
annual meeting comes ahead of the firm's expanded reliance on
highly sophisticated technology. In one example, BlackRock has long
commercialized an internal risk-management system known as Aladdin
but is increasingly seeking new ways for its own investors and
customers to use it.
The risk-management and technology platform has more than 180
customers and nearly $20 trillion in assets, BlackRock President
Rob Kapito said at an investor conference this February.
The $5.1 trillion money manager announced the recruitment of Mr.
Robbins Wednesday. Two older board members are also expected to
depart this spring, according to a person familiar with the matter.
Leaving the board at that time will be Thomas H. O'Brien, a retired
CEO of PNC Financial Services Group Inc., and David H. Komansky, a
retired CEO of Merrill Lynch & Co.
The 51-year-old Mr. Robbins has run Cisco, a Silicon Valley
network-equipment giant, since 2015 and currently doesn't have any
outside corporate board seats.
For BlackRock's Aladdin system specifically, firm leaders are
currently pitching the technology for risk assessment in the wealth
management industry, improved Wall Street plumbing through
custodians and digitizing money management for retail
investors.
"At BlackRock, technology is rapidly transforming how we invest,
measure risk, distribute our products, and run our operations."
said Laurence Fink, the firm's chairman and CEO, in a
statement.
Mr. O'Brien, who turned 80 earlier this year, has been
BlackRock's lead independent director. His successor in that
powerful post will be fellow director Murry S. Gerber, a former CEO
of EQT Corp., according to a person familiar with the situation,
the person familiar with the situation said.
Following this year's annual meeting, the BlackRock board will
have 18 members. Mr. Robbins will represent the sixth new
independent director added since 2012.
Further board turnover looms.
Under BlackRock's governance guidelines, directors must retire
at age 75 -- unless they had reached 70 years old as of July 2013.
Messrs. O'Brien, Komansky and two other board members were over 75
as of its April 2016 proxy statement. All but one had been a
BlackRock director for at least a decade.
BlackRock and other institutional investors have raised
questions whether long-tenured directors serve shareholders' best
interests. BlackRock revised its U.S. voting guidelines in early
2015 to signal that it might oppose directors with long tenure,
among other perceived shortcomings.
Write to Joann S. Lublin at joann.lublin@wsj.com and Sarah
Krouse at sarah.krouse@wsj.com
(END) Dow Jones Newswires
April 05, 2017 18:07 ET (22:07 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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