Dr. Benjamin S. Carson,
Sr., M.D. has been a director since 1999. Since 1984
he has been the Director of
Pediatric Neurosurgery at
Johns Hopkins University.
Seated lef t to right: Jill Ruckelshaus, Ri ck Libenso n, Bill Gates, Sr.,
Susan Decker, Dick DiCerchio, Jim Sinegal and Jeff Brotman.
Standing left to right: Tony James, Richard Galanti, Charlie Munger,
John Meisenbach, Dan Evans and Dr. Ben Carson.
Susan L. Decker, a director
since 2004, is president of
of Yahoo! Inc., where she
has worked since 2000.
From 1986 to 2000, Decker
held several positions
at Donaldson, Lufkin &
Jenrette, including director
of global research.
ently today—and much more in line with what their
role is—as the regulatory framework has changed
(Sarbanes-Oxley) and also as public awareness has
increased of the dysfunction that existed previously.
In short, the board’s role is fundamentally to represent the shareholders rather than to represent the
company’s executive team. Many more function this
way today than in the past.
attention by board members for all aspects of their
CC: In your decisions, how do you balance what
appears to be best for shareholders with what appears
to be best for the company? Do you sense that the two
are sometimes different?
Daniel J. Evans has been
a director since 2003. From
1983 through 1989, he
served as a U.S. senator for
the State of Washington.
From 1965 through 1977,
he served as the state’s
Dr. Ben Carson: The role of corporate boards has
certainly changed over the last decade, and the problems that occurred at Enron and other businesses have
actually benefited other companies in the sense that
they have caused corporate boards to become much
more vigilant and responsible. The board of Costco
was already vigilant and responsible, so that a lot of
changes were not necessary in this particular case.
William H. Gates, a director since 2003, is the father
of Microsoft Chairman Bill
Gates and co-chair of the
Bill & Melinda Gates
Foundation. A retired attorney, he serves on the Board
of Regents of the University
of Washington and has
served as trustee, officer
and volunteer for numerous
Bill Gates, Sr.: No question that some events in the
business world have raised concerns in the minds of
the investing public that cause them to look to company boards to exercise their authority to prevent
Dr. Ben Carson: It is sometimes perceived to be true
that what is good for the company is not necessarily
good for the shareholders, and there is no question
that some have been critical of Costco because they
feel that we are too generous to the employees and
that, in fact, some of the profits that go to employees
should instead go to shareholders. This is quite short-sighted, and I believe the Costco Board is in harmony
with the idea that if we provide maximum benefits
for consumers and are fair to employees, in the long
run everyone will win. Happy employees are much
more productive and feel ownership for the company,
which in the long run reduces the kind of problems
in the company that destroy profitability and in turn
Jill Ruckelshaus: Yes, it certainly has. I think board
members are much more concerned with their
responsibilities. Certainly Sarbanes-Oxley has placed
new reporting obligations on the company and
made the board much more diligent about policy
decisions, about other members who might be
asked to join the board and about the integrity of
those people. I think there’s a much finer degree of
Hamilton E. James, a
director since 1988, is the
president of The Blackstone
Group. He was also a direc-
tor of Credit Suisse First
Boston USA, Inc.,
formerly Donaldson, Lufkin
& Jenrette Securities
Susan Decker: Because I view the role of a public company to be to create long-term value for shareholders,
I see great alignment between company interests and
shareholder interests. Where there is lack of alignment, it generally arises based on the time frame in
which this is being judged or from disagreements on
judgments being made.
On the time frame, some shareholders measure
John W. Meisenbach
has been a director of
Costco since its inception.