Google Gets a Boardroom Upgrade

Updated

The boardroom is way more important than many investors seem to think. The buck really stops there, since directors have the power and the responsibility to hire and fire executives, set long-term strategies, and much more.

So when a major company changes the boardroom roster, investors should sit up and take notice.

Today, we're looking at online behemoth Google (NAS: GOOG) . The search giant just expanded its board from nine members to 10 by adding VMware (NYS: VMW) co-founder and former CEO Diane Greene. Eric Savitz of Forbes sees this move as "something of a coup" since Greene is "revered in the Valley." The appointment is effective immediately.

She's got the technical chops to guide a tech titan like Google, and also the proven business skills to make a difference. Google is throwing her right into the fray as a member of the audit committee. She'll share the responsibility for financial reporting and correct accounting procedures. It's a thankless job that only ever gets noticed when somebody does it wrong; kudos to anyone willing to step up to the audit plate, especially with the outsider snow still melting on her shoulders. She also serves on the board and audit committee of accounting software builder Intuit (NAS: INTU) , so the whole auditing job isn't exactly new to her.

The other three members of Google's audit committee are Kleiner, Perkins partner John Doerr, noted angel investor K. Ram Shriram, and Ann Mather, former Pixar CFO and, later, divisional finance chief for parent company Walt Disney (NYS: DIS) . It takes some serious financial know-how to contribute in an audit group like that.

Outside that committee, Ms. Greene gets to rub shoulders with Intel (NAS: INTC) CEO Paul Otellini, former Atheros CEO John Hennessy, and of course the well-known Page-Brin-Schmidt triumvirate at Google's nexus of power.

So what, exactly, does Diane Greene add to this august collection of tech legends? As VMware CEO from 1998 to 2008, Greene took the company from an upstart nobody had heard of to a virtual computing powerhouse with $1.9 billion in 2008 revenues. And don't forget that the whole Android platform runs on a specialized virtual machine, so her input could be valuable to Google's mobile efforts from the get-go.

With degrees in computer science, mechanical engineering, and naval architecture (no, really) Diane Greene is clearly intellectually curious and shouldn't be afraid to think outside the box. I think she'll fit in nicely with Google's often unconventional methods, and she'll get my reelection vote at the next shareholders' meeting for sure.

At the time thisarticle was published Fool contributorAnders Bylundowns shares of Google but holds no other position in any of the companies mentioned. The Motley Fool owns shares of Google and Intel.Motley Fool newsletter serviceshave recommended buying shares of Intel, Google, VMware, and Walt Disney. We have also recommended creating a bull call spread position in Intel. Try any of our Foolish newsletter servicesfree for 30 days. We Fools may not all hold the same opinion, but we all believe that considering a diverse range of insights makes us better investors. Check outAnders' holdings and bio, and follow him onTwitterandGoogle+. We have adisclosure policy.

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