Martian's Daughter: A Memoir (30 page)

How much the buildup of both congressional and public hostility to the CNOOC bid was actually based on national security concerns, in the military or strategic sense, and how much on a belief that a company owned and possibly subsidized by the Chinese government would provide unfair competition to privately owned American firms is impossible to tell. In any case, CNOOC's withdrawal rendered moot what would have been an interesting but difficult discussion by Unocal's board, centered on two questions. First, how should we have weighed our fiduciary obligations to the shareholders against our obligations as citizens to our country's best interests? Second, if we had concluded that the latter should dominate, would we have decided that the United States would be better off if CNOOC were allowed to buy Unocal or if it were prevented from doing so?

That conversation never took place in the Unocal boardroom, but I have played it over in my own mind every time a proposed investment in the United States by a foreign entity has attracted controversy. No general rule can cover all cases, but my own belief is that, if the United States is to continue to be regarded as a hospitable host to foreign investment,
such transactions should be prohibited only when national security, in the conventional meaning of the term, is at issue. Given that CNOOC had undertaken to sell all of Unocal's US assets—its interest was in the ones in Southeast Asia—it's hard to believe that our national security would have been threatened if the Chinese company had been the winning bidder.

Reflecting on the more than three decades I spent as an independent director of multinational companies, I ask myself how much value-added I had contributed to changes in corporate governance, beyond my symbolic role as a pioneering woman. In most cases, I'm confident that I did have some impact on the board's deliberations and the company's behavior. The one situation about which I feel no such reassurance is my performance as a director of Alcoa, the worldwide aluminum company. I had been asked to join that board by its chairman and CEO, Paul O'Neill, another acquaintance from my days on the CEA, when he was a rising young deputy director of the Office of Management and Budget (OMB). Paul liked to anchor Alcoa's strategic decisions firmly in the current global political and economic picture. As part of that approach, he relied on Ken Dam—who had been Paul's colleague at OMB and, at later points in his career, became deputy secretary of both the state and treasury departments—to give periodic reports on political developments and trends around the world, not only to the board but to business unit managers as well; Paul relied on me to do the same on the economic side.

For very different reasons, both Paul and I struck out after he resigned, in 2000, to become secretary of the treasury and took Ken Dam with him as his deputy. Paul's successor at Alcoa, Alain Belda, had a very different management style, which did not include our global briefings. Apparently that difference made me superfluous in Alain's eyes; one day he invited me into his office a few minutes before a meeting of Alcoa's nominating committee and asked me to resign to make room for a new director. I was hurt and angry at the grade of F he had implicitly given me and thunderstruck by the brusque way in which it was delivered, allowing me almost no time to make up my mind. But, privately, I had to admit to myself that I hadn't found a way to have much impact on the board's deliberations or decisions once Paul O'Neill had departed. Paul's dismissal from his cabinet post was far more public. It came from President
George W. Bush, after Paul disagreed with the President and his other economic advisers on their proposed tax cuts and insisted repeatedly that there was no evidence of weapons of mass destruction in Iraq.

Whatever progress “my” boards made in corporate governance, it wasn't enough. Of the seven firms, only two—P&G and Alcoa—preserved their identities in the face of the upheavals that were reshaping American business during the last quarter of the twentieth century. Marcor, BFI, and Unocal were acquired by and merged into larger firms; Manny Hanny had been involved in three major mergers and name changes; and Westinghouse, known as a leader in the nuclear power industry, had sold off its birthright and transformed itself into the entertainment company CBS. And the financial scandals, crimes, and disasters that marked the first decade of the twenty-first century revealed how far corporate boards of directors still have to go to fulfill their monitoring role effectively. Women are still in the minority on corporate boards today, but very few of them are feeling the isolation of being the first woman, as I did. Silently, I say to them, “Go girl; be a pushy broad and put some spine into whatever board you're on.”

The governing bodies of leading universities were grappling with some of the same social issues as the boards of for-profit corporations, I discovered when I served on two of them. One was Harvard, where I had spent my undergraduate years; the other was Princeton, which had played such an important role at various stages of my life, even though it had refused to admit me as a graduate student. Both institutions were also caught up in questions of effective governance. And, although universities are grounded in a dedication to the principles of openness and the free exchange of ideas, both conducted much of their decision making in sessions closed to outside eyes.

Harvard and Princeton had their own version of the “withdrawal versus constructive engagement” controversy several decades before it erupted at Unocal. There the question was whether to continue to hold stock in companies that did business in South Africa, then under the yoke of a regime firmly committed to apartheid. As was true of many college campuses during the 1970s, Harvard was feeling strong pressures, intensified by student protests in 1972 and again in 1977, to disinvest entirely from such companies.

Like many of its sister institutions, Harvard at first chose a path of compromise, actually selling stocks only in cases where companies failed to adopt the Sullivan Principles. These principles required firms operating in South Africa to treat all employees equally regardless of race, to promote the advancement of blacks and other nonwhites in the workplace, and to take measures to improve the quality of life for these groups outside the workplace as well. This question, which was roiling the Harvard campus when I left its Board of Overseers in 1978, was doing the same at Princeton when I joined its Board of Trustees in 1980. Later, as a director of Unocal, I was to confront the issue once again. In each of these situations, I would have found it more comfortable to come to a decision based on some simple universal principle. But the moral choice is never unambiguous, the empirical evidence is mixed, and the question is not likely to be resolved definitively in my lifetime, if ever.

Like the Harvard and Princeton governing boards at the time, I believed, and still do, that in most situations constructive engagement—maintaining limited political and business links with a country despite its inexcusable policies, while continuing to press for political or social reform—is likely to be more effective than total withdrawal. In hindsight, though, I have become convinced that, under the particular circumstances of apartheid South Africa, disinvestment was the more effective course. By the end of the 1980s, Harvard had almost entirely withdrawn from investment in South Africa; Princeton eventually did the same. And the Reverend Sullivan, a director of General Motors and the author of the principles that bore his name, had himself abandoned his original principles as ineffective and become a champion of disinvestment.

A very public issue, the changing status of women in the corporate world, had its counterpart in the private world of Harvard. Although many of the restrictions on female students' full participation in Harvard life had been eliminated by the time I joined its board, women undergraduates, who were more and more often seeing themselves as Harvard rather than Radcliffe students, had become increasingly vocal about their dissatisfaction with the distinctions that remained. They were particularly unhappy that the men's and women's housing were separated by a mile or more, and that the Harvard Houses offered a range of house-centered intellectual and cultural activities that the Radcliffe dorms lacked.

This gap in the lives of female undergraduates was filled by the creation of a unified house system for undergraduates. Women would be allowed to live in the Harvard freshman dorms and upper-class houses, and men could choose to live in the Radcliffe dormitory quadrangle, which gradually acquired many of the ancillary benefits enjoyed by the Harvard Houses. As a Radcliffe student twenty-five years earlier, I had been denied access to multiple Harvard facilities, including its undergraduate library and its MBA program. Now, as a member of Harvard's governing board, I felt a special thrill of satisfaction in helping to knock the last of these barriers down.

The dramatic changes in the status of Radcliffe undergraduates were formalized in a 1977 agreement between the President and Fellows of Harvard College and the president of Radcliffe, which stated, “Undergraduates admitted to and subsequently enrolled in Radcliffe will thereby be enrolled…in Harvard College with all the rights and privileges accorded Harvard College enrollment.”
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No longer would women graduates have to be awarded Harvard degrees retroactively, as my generation was, in order to be able to vote in alumni elections and to serve on either of Harvard's two governing boards.

The status of women faculty at Harvard has not been so easily resolved. The question of why there were so few female faculty members, especially at the senior level, came up again and again in meetings of the board and its committees. Harvard's president at the time, Derek Bok, repeatedly stated his commitment to the recruitment and advancement of women faculty, and I believe he was sincere. At the same time, he clearly believed that women's sense of obligation to family often prevented them from pursuing an academic career with the same single-minded intensity as men.

Bok may have been influenced in this judgment by the experience of his wife, the influential philosopher and ethicist Sissela Bok who, despite her growing eminence, declined to fight her way up the tenure-track ladder. As someone who had only recently completed that climb while raising children, I felt that the president's view was rather patronizing and told him so, but I doubt that I had much effect on his outlook.

Why, I wondered when I was elected to Harvard's Board of Overseers, are we called overseers rather than trustees? Whereas other universities
have a single governing board, Harvard has two. The Harvard Corporation, known formally as the President and Fellows of Harvard College, is the university's executive board. This self-perpetuating body meets every other week and effectively runs the institution; in the words of the
Harvard Guide
, “[T]he seven-member board is responsible for the day-today management of the University's finances and business affairs.”
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The second governing board, the Board of Overseers, is a larger body elected by the alumni for six-year terms; its role is to “advise and consent.”

It didn't take me long after I was elected to discover two things about the Board of Overseers, whose archaic title, the Reverend and Honorable Board of Overseers, goes back to the charter granted to Harvard by the Commonwealth of Massachusetts in 1650. One was that the presence of women was as much of a novelty there as it was on corporate boards. The first one, Helen Gilbert, also chair of the separate Radcliffe Board of Trustees, had become an overseer only two years before Adele Simmons and I were elected. Because only Harvard alumni could vote for overseers, Radcliffe graduates had been awarded Harvard degrees retroactively so they could vote in these elections or serve as overseers.

The male overseers had welcomed Helen Gilbert, a middle-aged Boston grande dame with strong aristocratic features, gray hair befitting her age, and impeccable social credentials, without difficulty; she actually headed the board during my first year there. Adele Simmons was another matter. A history professor at Tufts University and dean of its women's college at the time, she later became a Princeton professor and dean, president of Hampshire College, and president of the MacArthur Foundation. Adele was also beautiful, an outspoken blonde barely into her thirties. I shall never forget the faces of our male colleagues sitting in the basement bar of the Harvard Faculty Club as they watched Adele, earnestly discussing some fine point of Harvard governance as she simultaneously nursed her new baby and drank an old-fashioned through a straw.

The other salient truth that struck me almost from my first moment was that Harvard's bicameral governance structure was a perpetual source of angst and soul-searching to the overseers. Since the Harvard Corporation made or approved all the important decisions, what was our function? As one member put it, the Board of Overseers was an impressive
club to belong to, but she didn't see that it had any real responsibilities or influence over Harvard policies. The rationale for the bicameral structure, the functions of its two bodies, and the relationship between them, were the object of a major review as my term as an overseer was coming to an end. Some incremental changes were made in the interest of better defining their respective roles and increasing the interaction between them, but the bicameral structure itself—and the overseers' angst—remained. Not until 2010 was a more drastic overhaul of the composition, structure, and practices of the Harvard Corporation announced;
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it is too early to tell what effect that will have on the practice of governance of the university.

The makeup of the Board of Overseers itself was also a cause for hand-wringing The 1970s was an era of social ferment and change, when antiestablishment views gained currency and the military-industrial establishment was widely regarded as the axis of evil. The Harvard alumni tended to reflect these views, and they expressed them in their votes for overseers. A candidate who was a woman, a minority, an environmentalist, or a public servant was virtually assured of election, while it was almost impossible for a businessman or banker to be among the chosen. But since one of the responsibilities of the board has traditionally been fund-raising for Harvard, the discovery that the current membership, however worthy, collectively had very shallow pockets and lacked a wide circle of deep-pocketed acquaintances was unsettling. As I quipped, “If you turned all the overseers upside down and shook them, a few nickels would roll out.”