An Apple Board of Directors for the 2010s

Eric Schmidt's exit creates an opening for Apple to make COO Tim Cook a director. Next it needs members to help face the challenges of its fourth decade

By Arik Hesseldahl

Now that Google (GOOG) CEO Eric Schmidt has left Apple's board, the path is clear for the company's next likely director, Chief Operating Officer Tim Cook, to join. Apple (AAPL) is firing on all cylinders now. But the challenges that will face the company in the next decade—which include managing its larger size, reckoning with Internet-based computing, and growing overseas—will require more fresh blood on the board.

Schmidt left, as I argued should happen more than a year ago, because of broadening competition between Google and Apple. That will likely open the door for Cook to become a director, rewarding him for his stewardship.

With Apple in its fourth decade and heading toward $50 billion in sales sometime in the 2010s, the company will need further governance changes in the years ahead. In talks with academics, board recruiters, and various industry sources, a few themes have emerged.

Apple will need on its board an executive who has run a $100 billion company—someone like former IBM (IBM) CEO Lou Gerstner or an executive from a diversified company such as Procter & Gamble (PG) or General Electric (GE). It could use someone from the social media world such as Netscape founder Marc Andreessen, as well as a director who understands cloud computing. An executive steeped in emerging markets would help, too. Former Infosys Technologies (INFY) CEO Nandan Nilekani comes to mind.

Big-Company Board Vet York Is 70

For all the expertise of Apple's executive team and current board, there's hardly anyone experienced at operating or governing a company as large as Apple is on the verge of becoming. Given Apple's centrality to a growing number of industries—among them computers, cell phones, and recorded music—the company punches above its weight in influence.

The one board member who has worked at supersized companies—IBM, Ford (F), and General Motors veteran Jerome York—is 70 years old and will be required to retire in five years under Apple's bylaws.

Other current directors lack experience at such large companies. I'm thinking of Arthur Levinson, former CEO of Genentech, which was a $13 billion concern before it was acquired by Roche this year, or Avon Products CEO Andrea Jung (AVP), whose company runs about $10 billion in sales.

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