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Mary Barra Assumes Combined Chairman And CEO Role At GM

By Alisa Priddle Detroit Free Press.

DETROIT

Mary Barra has cemented her leadership of General Motors with Monday's board of directors decision to make her both chairman of the board and CEO in a show of confidence in her skills leading one of the world's largest automakers.

The promotion is effective immediately. Barra, 54, replaces outgoing chairman Theodore Solso, who will stay on the board as lead independent director, offering a counterpart to Barra's consolidated power.

The move returns GM to a past practice. Barra's predecessor, Dan Akerson, was both chairman and CEO when he retired in January 2014. When Barra succeeded him as CEO only, some raised the question of whether gender was a factor in the decision.

But the separation of duties for a new CEO as they grow into the position is a long-standing practice at GM.

Going back to 1993, history shows past CEOs Akerson, Ed Whitacre, Rick Wagoner and John Smith all also held the chairman title by the end of their tenure. Fritz Henderson did not, but his brief nine-month CEO stint during bankruptcy restructuring in 2009 did not afford him enough time to add the extra duties before he was let go.

In an earlier era, from 1958 to the end of Robert Stempel's reign at the top in late 1992, GM combined the positions from the initial appointment.

Giving Barra both titles now shows the board is pleased with her accomplishments as she approaches her second anniversary leading the company.

"At a time of unprecedented industry change, the board concluded it is in the best interests of the company to combine the roles of chair and CEO in order to drive the most efficient execution of our plan and vision for the future," said Solso.

"With GM consistently delivering on its targets and on track to generate significant value for its shareholders, this is the right time for Mary to assume this role."

"I am honored to serve as chair of the board of directors," Barra said. "With the support of our board, we will continue to drive shareholder value by improving our core business and leading in the transformation of personal mobility."

Industry analysts are divided on the wisdom of combining the top posts. Some feel a chairman should be independent.

Jeffrey Sonnenfeld, senior associate Dean for Leadership Studies at the Yale School of Management, disagrees. "There is no evidence that the separation of chairman and CEO roles leads to better governance, superior financial results, or more responsible conduct."

"In fact, most major corporate scandals here and abroad already had a separation of roles," Sonnenfeld said. "For many firms, the unity of command clarifies the decision-making process and the voice of the enterprise. A strong lead director can provide needed protection for shareholder interests from potential abuse of power."

At GM, Solso provides the strong independent voice. Additionally, of the 12 board members, Barra is the only director who is a GM employee.

Barra took over as GM CEO on Jan. 15, 2014, making her a leader in the auto industry globally and one of the most important women in the U.S.

She garnered a lot of press and accolades for her high profile breaking of the glass ceiling in an industry long dominated by men.

But GM officials, including outgoing CEO Akerson, were quick to say she was the best person for the job.

"Mary was not picked because of her gender," Akerson said in December 2013 after announcing Barra as the choice to replace him upon his retirement. "Mary is one of the most gifted executives I've met in my career. She was picked for her talent."

And when she assumed the job two years ago, Barrra told reporters she was pleased young women see her as a role model but she would not dwell on the historic nature of her appointment.

She was arguably more impressed that the top job went to an engineer instead of a finance officer. The last engineer to lead the company before her was Bob Stempel in the early 1990s.

Solso on Monday indicated Barra has set a clear vision for the organization over the past two years, formed a strong leadership team from inside and outside the company, delivered strong operating results and led the introduction of breakthrough vehicles and technologies.

Early in her tenure at the top of the company, Barra had to deal with an investigation into a delayed ignition switch recall and subsequently ordered an overhaul of operations to try to ensure a similar safety crisis never happens again. She has also been the face of the company in rebuilding public trust.

Once she was able to move on to other strategic initiatives, she started reshaping the company's global footprint by ending Chevrolet sales in Europe and pulling out of troubled Russia altogether.

She also showed her mettle in rebuffing merger advances from Fiat Chrysler Automobiles CEO Sergio Marchionne, confident in GM's strength as a standalone company. She backed it all up with strong financial results.

On the technology front, Barra is leading efforts to ensure GM is among the leaders in autonomous vehicles and she is embracing modern trends such as car sharing with Monday's announcement the automaker is investing $500 million in Lyft, a ride-hailing company.

"Mary Barra is a genuine car person and superb leader _ widely respected around the industry, trusted by her customers around the world, admired by her board, and revered by her employees," Sonnenfeld said. "Painstakingly, and transparently, she has rebuilt trust and vitality in the enterprise when it had been shattered by a few careless predecessors."

Prior to becoming CEO in 2014, Barra was executive vice president of global product development, purchasing and supply chain, and she previously served as senior vice president of global product development. In these roles, she was responsible for the design, engineering, program management and quality of GM vehicles around the world.

She has also worked in human resources, manufacturing, engineering and was a plant manager at the Detroit-Hamtramck assembly plant

In 1990, Barra graduated with an MBA from the Stanford Graduate School of Business after receiving a GM fellowship in 1988. She began her career with GM in 1980 as a co-op student from the General Motors Institute (Kettering University).

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