Will Cisco Systems Ask Jerry Yang To Leave Its Board? (CSCO, YHOO, MSFT)

Most people think of Jerry Yang as the Chief Yahoo! over at Yahoo! Inc. (NASDAQ: YHOO).  But there is another Jerry Yang role, and we aren’t talking about him living up to the branding of "chief Yahoo!" in more ways than one.  We have gone over and over how Jerry Yang and kids managed to destroy value for shareholders.  If there had been a long-standing record or a current path that was working this entire situation and reasoning would have been different.  But those suppositions include the "IF, THEN" factor and the truth is now the exact opposite.

The role of Jerry Yang that he currently holds that gets very little attention is his role as a member of the board of directors at Cisco Systems, Inc. (NASDAQ: CSCO).  He has actually been on the board of directors over there since July 2000, according to Capital IQ. 

We looked over the other anti-takeover provisions at CapitalIQ to see what else was there. We also looked over the corporate governance section over at Cisco’s website.  Yang is on the investment/finance committee of the board at Cisco.  But CapitalIQ notes that Cisco does not have a classified board, its member terms are for 1 year, and it lists its "removal of directors only for cause" as NO.  Shareholders do have the ability to act by written consent, although it may be a far stretch to believe that this represents any such issue that shareholders would want a special meeting.

The company has sent out the general proxy materials to shareholders in September for each of the last two years for the annual shareholder meeting to be held in November. 

It is probably doubtful that John Chambers or today’s board of directors would go out of their way to make any direct actions on an interim basis.  Yang also isn’t in the position to sink Cisco either as an independent, even if he is on the investment/finance committee for Cisco.  The one thing that may save Yang and keep him valuable is that the competition for Cisco with Yahoo!’s merger adversary at Microsoft (NASDAQ: MSFT) may now have enough forward competition that the company could keep him on for that matter. 

Sometimes it is good to clean house a little, and keeping a Jerry Yang around for 2009 probably isn’t as attractive and probably doesn’t offer quite the same insight as in many of the years before. 

In today’s world of the Internet, anything is possible.  Reinvention is possible.  New business segments that didn’t exist are possible.  And even redemption is possible.  Either way, the Doubting Thomas analogy is a hard one to get past.

Jon C. Ogg
July 2, 2008