Good idea of the day

Getting corporate directors to do the right thing

Plenty of outrage — predictable, if totally justified — in response to Pfizer’s $160 billion “tax inversion” takeover of another drug giant, Allergan. Of course, the deal has nothing to do with Pfizer being globally “competitive” once freed of the shackles of U.S. taxes, as its CEO avers. Quite obviously, it has everything to do with unalloyed greed.

There have been calls for the U.S. government to do something, but rather than holding one’s breath — vainly, I suspect — for that to happen, what if the deal didn’t get past Pfizer’s own board? Here’s the New Yorker’s economics columnist John Cassidy (‘The Pfizer-Allergan merger is a disgrace’) with a most excellent suggestion (and names attached).

…the best hope may be to put some public pressure on Pfizer’s non-executive directors, whose approval is necessary for the merger to go through. Its lead independent director is Dennis Ausiello, an eminent physician who, for many years, was chief of medicine at Massachusetts General Hospital. Other non-executives on the Pfizer board include Frances Fergusson, a former president of Vassar College; Helen Hobbs, a professor of medicine at the University of Texas Southwestern Medical Center; W. Don Cornwell, a former chief executive of Granite Broadcasting; and James Kilts, a founding partner at the private equity firm Centerview Capital.

These directors are all experienced, worldly individuals. Last year, according to Pfizer’s 2015 proxy statement, they were each paid more than three hundred thousand dollars to carry out their duties, which include overseeing the company’s full-time management and protecting the long-term interests of all of its stakeholders: employees, shareholders, and customers.

The “public pressure” Cassidy refers to worked with Walgreens, which was about to become a Swiss citizen before 200,000 members of the American public signed a petition stopping the move dead in its tracks.

People power. It’s worth trying.