America’s Worst Directors: AMD’s Robert B. Palmer

The role of directors and their performance are not as visible as are the performances of public company CEOs. However, they are nearly as important in some cases.

Boards have the final say in who runs a public company. They also control who will sit on their boards, what management makes in compensation, and how complete and accurate the audit statements of their firms are. Boards are also charged with guiding the strategic direction of the companies they serve.

24/7 Wall St. will, from time to time, look at the worst board members. This will be based on their positions on the boards, the returns the companies have given to shareholders over the periods of their tenures, the quality of management over the same period and the quality of governance.

Robert B. Palmer has been a member of the AMD (NYSE: AMD) board since 1999. The chip company’s stock price is down about 50% from the end of that year. Palmer was the chairman and CEO of troubled tech company Digital Equipment from 1995 to 1998.

Palmer was at AMD during the disastrous buyout of graphics chip company ATI in mid-2006. The purchase price was $5.4 billion which severely burdened AMD’s balance sheet. AMD was modestly profitable in 2005. It lost money from 2006 to 2008. Intel’s (NASDAQ: INTC) $1.25 billion in 2009 settlement helped its financial results.

Palmer was also on the board during the disastrous tenure of CEO Hector Ruiz. Ruiz eventually stepped down as CEO in July 2008 after AMD had lost money in seven straight quarters.

AMD’s revenue was off 2% in its most recently reported quarter. The company lost $118 million for the period. AMD’s shares are down 15% over the last year. Palmer made $274,000 as an AMD director in 2009.

Douglas A. McIntyre