Interpublic Group's board of directors is considering two types of candidates with very different skill sets for the holding company's new COO post. The direction they choose may indicate their level of faith in and commitment to CEO John Dooner.
The board, which continues to exert more influence and control over the $6.8 billion company, is debating whether Dooner's No. 2 should be a financial or operational leader, sources said.
Richard Goldstein, an ally of Dooner's who joined the board last year, has emerged as a key player in the search, which is being led by human-resources chief Brian Brooks, with help from Heidrick & Struggles.
If IPG hires someone with an operations background, it could pose a threat to Dooner, or at the very least lay the groundwork for a succession plan down the line. If the COO is a financial type, CFO Sean Orr may feel challenged, according to sources.
Operational types who have been contacted include Roger Haupt, president and CEO of Publicis Groupe, sources said. He did not return calls.
The IPG board appears divided over the larger issue of Dooner's stewardship, which has been rocky since he took over from Phil Geier in 2001. Some members, including Reg Brack and Frank Borelli, who both joined the board under Geier, seem willing to consider a change at the top. Brack, who is seen as a critic of Dooner's, could not be reached; Borelli did not return calls. Others, including Goldstein, continue to support Dooner.
Dooner's first year was marred by client fallout from IPG's $2.1 billion stock acquisition of True North Communications, including the loss of $400 million in PepsiCo and Quaker Oats business. Year two has been even more difficult, with a pattern of missed revenue targets, shrinking dividends and stock erosion. Further clouding IPG's balance sheet was a $181.3 million restatement stemming from an accounting imbalance that was nearly three times what the company initially estimated.
The mounting problems prompted the board last month to install Borelli, a former CFO, as a presiding director—a part-time role designed to give the board a hand in operational decisions. The COO search, launched soon thereafter, is also a tacit acknowledgment that IPG needs help upstairs.
Dooner declined to comment. He has publicly noted that the company has grown threefold in the past five years and that installing a COO would be helpful.