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About Pascal Levensohn
A venture capitalist and financial services professional with close to 30 years of experience in his field, Pascal Levensohn brings a genuine passion for innovation to his work at Levensohn Venture Partners in San Francisco, California. After graduating from the Lawrenceville School in 1977, Pascal Levensohn enrolled at Harvard University, where he spent the next four years studying political economy with an emphasis on international relations as a Government major. Upon receipt of his Bachelorâs degree cum laude in Government from Harvard in 1981, Pascal Levensohn moved to New York City and began to lay the foundations for his career in finance. Over the course of nine years in New York, Pascal Levensohn was a risk arbitrageur for seven and a half years, mostly at the First Boston Corporation.
In 1990, Pascal Levensohn moved to the San Francisco Bay Area to take a position as Managing Director and Partner at Richard C. Blum & Associates, where he invested in public and private companies for as an active investor for three and a half years and took his first public company board seat in 1993. With a keen insight into the burgeoning high-tech industry in the Silicon Valley region, Pascal Levensohn struck out on his own in 1994 and established his first venture capital fund, Star Bay Partners, L.P., through Levensohn Venture Partners in June 1996. As a venture capitalist Levensohn focused his companyâs resources on early-stage California-based firms. Pascal Levensohn has spent the past 14 years developing strategic relationships between Levensohn Venture Partners and entrepreneurs throughout California, and he continues to play an active part in the growth of his portfolio companies. Today, Pascal Levensohn and Levensohn Venture Partners are well known as investors in early-stage digital media, demand-side clean technology, and security firms with superior, demonstrated potential in the technology marketplace. Among the portfolio companies of Levensohn Venture Partners, Pascal Levensohn currently sits on the Board of Directors at Veraz Networks, Ubicom, Inc., Akros Silicon Inc., and ShotSpotter, Inc. For more information on the professional background of Pascal Levensohn, visit the Levensohn Venture Partners website at levp.com.
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Fiduciary Shortcomings of Hewlett Packard’s Board of Directors, Pascal Levensohn's Blog on Bigsight
October, 2011
by Pascal Levensohn
Through my experience as a director on private and public company boards since 1993, I have collaborated with other experienced directors to define and elaborate board of directors’ best practices, focusing on venture capital-backed enterprises. The board has an important role to play in defining the direction of any company, with one of its primary responsibilities being hiring and firing the chief executive officer (CEO). It was disheartening to read a New York Times article a year ago describing the CEO selection process used by Hewlett Packard (HP). What stood out in particular was that the process did not require all 12 board members (including 4 HP directors) to interview the CEO search committee’s choice prior to offering him the position of CEO. Considering this flawed selection process, it is hardly surprising that HP also engaged in a number of high-profile missteps that led to the firing of that CEO, driving down company equity by approximately half. This problem seems to have been endemic within the board, reflecting unresolved dysfunctions that span the reigns of three CEOs in the past six years. Notably, the problem does not reflect lack of intellectual capacity or business acumen among board members. The problem rather (as reported) lies in group dynamics that breed distrust, with members vying for power within the board at the expense of the entire company’s welfare.
The importance of having a dynamic, functioning board for any company, large or small, cannot be overstated. Central to this is the fact that the CEO, who sets the organizational direction and strategy, reports directly to the board. In not requiring each board member to personally interview its prospective CEO, I believe that the Hewlett Packard board of directors violated a number of fiduciary duties, namely the duty of care, the duty of good faith, and the duty of loyalty. Personal agendas and process fatigue were allowed to rule the day, resulting in a board unable to properly fulfill its primary responsibility of hiring, firing, and overseeing the performance of the CEO. Naturally, it is difficult to draw definite conclusions from a newspaper article, however reliable the source. If the facts were reported correctly by The New York Times, then the entire HP board of directors bears some measure of responsibility for the loss of stock value experienced by HP shareholders. This underlines the need for adherence to corporate governance best practices by any company, no matter how large or successful. Without vigilance in maintaining optimal board functioning, a company can easily lose its bearings and falter, resulting in disastrous effects for rank-and-file employees and investors.
About the Author: A graduate of Harvard University, Pascal Levensohn has served as the Managing Partner of Levensohn Venture Partners since 1996.
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