Insiders Out on Omnicom Board

The restructuring of the Omnicom board that calls for the removal of seven agency executives as directors leaves CEO John Wren and chairman Bruce Crawford as the only employee directors.

The new board will also consist of eight current nonemployee directors, plus one newcomer, for a new total of 11, down from 17.

Some directors leaving the board date back to the holding company’s founding in 1986. Two of those longtime directors, who will resign their seats after the May 21 annual meeting, are Keith Reinhard, chairman, DDB Worldwide, and Allen Rosenshine, chairman, CEO of BBDO Worldwide.

In addition, five directors have decided not to stand for re-election: Jim Cannon, vice chairman and CFO, BBDO Worldwide (a director since 1986); Bernard Brochand, vice chairman, DDB Worldwide (a director since 1993); Thomas Harrison, chairman, CEO, Diversified Agency Services (a director since 1999); Michael Greenlees, evp, Omnicom (a director since 2000); and Jean-Marie Dru, president, CEO, TBWA Worldwide (and a director since he assumed his current role last year).

Omnicom is nominating an outside member to its board: Robert Charles Clark, the 58-year-old dean of the Harvard University Law School.

“The composition of our board of directors, which currently has 17 members and a majority of non-employee directors, has remained essentially the same since our company was founded in 1986,” Wren said. “With several management tran sitions in the last year, as well as the upcoming expiration of the terms of five of the seven directors, we thought it was an appropriate time to consider our long-term objective of modifying our board composition.”

Among those “transitions” is Ken Kaess’ ascension to CEO at DDB—becoming Reinhard’s heir apparent.

Many companies have been reducing the number of insiders on their boards. Interpublic Group recently cut four of its employees, leaving IPG with a nine-member board that has only two insiders, CEO John Dooner and CFO Sean Orr.

Omnicom’s revamping also consolidates Wren’s authority on the board. “This newly reconstituted board will be facing any number of important issues and we’ll have to see how policy will be formulated,” observes David Leibowitz, an analyst at Burnham Securities.