Salesforce is bowing to investor pressure, appointing new board members shortly after activist investor Elliott Management invested in the company.
Sales announced it had appointed three independent board members late last week “as part of its ongoing board refreshment process.” The new board appointments go into effect March 1, 2023.
The new board members are:
- Arnold Donald, former President and Chief Executive Officer of Carnival Corporation & plc;
- Sachin Mehra, Chief Financial Officer of Mastercard; and
- Mason Morfit, Chief Executive Officer and Chief Investment Officer of ValueAct Capital
“We’re excited to welcome Arnold, Sachin and Mason to the Salesforce Board,” said Marc Benioff, Chair and CEO of Salesforce. “As highly respected business leaders, they each bring valuable experience to further enhance and balance the diverse skills on the Board and advance our value creation initiatives. We look forward to benefiting from their expertise and insights as Salesforce continues to drive durable top- and bottom-line growth and build on our position as the world’s #1 CRM.”
“The addition of these three new independent directors to our Board demonstrates Salesforce’s commitment to ongoing refreshment in action,” said Robin Washington, Lead Independent Director of the Board. “Arnold’s proven cross-industry leadership experience, Sachin’s expansive financial, technology and operational expertise and Mason’s investor perspective and record of helping public companies build sustainable, long-term value will further strengthen our Board’s depth of expertise and diversity of thought. Ensuring we have the right Board in place to guide the Company’s strategy and oversee its ambitious goals continues to be a top priority. Over the past year, we have benefited from the valuable input of our investors and look forward to continuing that dialogue as we drive value for Salesforce shareholders.”
Salesforce’s decision to appoint additional board members is likely in response to Elliott’s multibillion-dollar investment in the company, and may be an effort to avoid an all-out proxy fight. Elliott has a long history of heavily investing in companies and then aggressively pushing for executive and board changes.
According to The Wall Street Journal, that appears to be exactly what Elliott is doing with Salesforce, with the investment firm preparing to nominate its own slate of directors.
“Salesforce is one of the pre-eminent software companies in the world, and having followed the company for nearly two decades, we have developed a deep respect for [Co-Chief Executive] Marc Benioff and what he has built,” said Jesse Cohn, managing partner at Elliott, at the time of investment.
“We look forward to working constructively with Salesforce to realize the value befitting a company of its stature,” added Cohn.
Elliott’s involvement comes at a difficult time for Salesforce. The company has seen the departure of some of its top executives in recent weeks, as well as layoffs that have impacted roughly 10% of its employees.