GM's Directors Start Acting . . . Like Directors

[Bruce Nunnally]

By STEVEN RATTNER AND HARRY J. WILSON

Tuesday's announcement that Fritz Henderson is stepping down as chief executive of General Motors vividly demonstrates the central role that the company's board of directors is playing as the nation's largest auto maker continues its progress toward full private control.

A key part of President Obama's actions to remake this iconic company was the decision that after GM's restructuring, oversight of the company should shift from his administration into the hands of a world-class, highly engaged board of directors, chosen purely on the basis of their qualifications.

Recruiting a chairman was the Obama administration's first step in assembling the board. Fortunately, Ed Whitacre, who had delivered superior results for 18 years as a no-nonsense, demanding but fair chairman and CEO at AT&T, was willing to serve. In concert with Mr. Whitacre, the administration selected directors who complemented him with turnaround and private-equity expertise. For Mr. Whitacre and the other nominees—many of whom routinely turn down board requests—joining GM's board was a form of public service.

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