The drama around former McDonald’s (tkr: MCD) CEO Steve Easterbrook could have been avoided if the Board had been engaged. Similarly, the company’s HR function failed. Self-preservation is to blame. Ironically, McDonald’s Board is at risk of being purged and HR leadership has already turned over under new MCD CEO Chris Kempczinski.
How is self-preservation a factor? CEOs to a degree control who sits on the Board. Further, don’t fool yourself into believing that Board members serve some higher purpose. They are career-minded. Many are full-time board members who make a career sitting on corporate boards. Many board members fear rocking the boat and developing a reputation as a trouble-maker for this could jeopardize their board seat and potentially torpedo the opportunity for future board seats. It’s easier to turn a blind eye than to risk becoming a dissenter.
A CEO’s power over a department head is obvious and therefore there is no great mystery as to why McDonald’s former HR head failed to act.