Under-fire HP board trio succumbs to investor pressure

Ray Lane resigns as chairman, while Ken Thompson and John Hammergren leave the firm entirely following campaign to have them removed

Following weeks of criticism from investor representatives, HP's under-fire directors have resigned their roles to "reduce any distraction from HP's turnaround".

Executive chairman Ray Lane and the vendor's two longest-serving directors, Ken Thompson and John Hammergren, have faced public calls for their heads in recent weeks from powerful investor groups. All three were voted back to their posts at last month's annual shareholder meeting, but had the backing of just 59, 55 and 54 per cent of shareholders respectively.

Today HP announced that Lane is relinquishing his chairmanship, although he will remain a director, while Thompson and Hammergren are leaving the company altogether. Hammergren's role as chairman of HP's Finance and Investment Committee will be filled by Ralph Whitworth, who will also serve as interim chairman while the search for a new non-executive board leader takes place.

The vendor will also be on the hunt for two new independent directors to replace Thompson and Hammergren. Rajiv Gupta will assume Thompson's post as chairman of the Audit Committee, with Gary Reiner replacing Gupta as head of the Nominating and Governance Committee.

Lane stressed his determination to "help finish the job" of turning around HP's fortunes, but said he was stepping down "after reflecting on the stockholder vote".

"I have decided to step down as executive chairman to reduce any distraction from HP's ongoing turnaround," he explained.

Whitworth added: "Ray, John and Ken are terrific leaders, and they are passionate about doing the right thing for HP. From here we will continue to recruit outstanding directors, strengthen our governance and do the best we can – the best we know how – for stockholders. Meg [Whitman] is leading a Herculean turnaround, so most of all, we must build and maintain the best possible leadership structure for Meg and HP's entire team to succeed."

Whitman too saluted the contribution made to the vendor by the executive triumvirate, claiming that they "have invested a part of themselves in HP".

"Their leadership is reflected in the early success we have had turning the company around," she said. "I am grateful that Ray will continue to serve, and I wish John and Ken the very best. I also appreciate Ralph's willingness to increase his responsibilities during this transition."