Regulatory Chiefs Who Join Corporate Boards
Three months after her departure from the Securities and Exchange Commission, former Chairwoman Mary Schapiro has been nominated to join the board of General Electric. If she accepts, she will be the third former regulatory chief to join a board of directors this year.
While some move into legal or professorial positions, it is not uncommon for some of the top regulatory talent to offer their services to the corporate sector after their terms are up. According to former SEC Commissioner Harvey J. Goldschmid, who served under George W. Bush and is now a professor of law at Columbia University, the knowledge gained in the oversight role can be a boon for the company.
“The experience in Washington certainly would be excellent experience for understanding issues that would come before the modern financial or industrial corporation,” Goldschmid said. “I can imagine why GE would want to reach out to Mary Schapiro.”
Goldschmid himself served on a company board for the Greenwall Foundation, a grant-making nonprofit, before and after his term with the SEC. He said he enjoyed the role because he found the work important, although it paid only in the four-figure range.
In some cases, the firm that the former regulatory chief joins may seem unrelated as a number joined bio-tech or healthcare companies. There may be some strategy behind that move, however, as the former regulators would be prohibited from using certain government or regulatory knowledge in the private sector, Goldschmid said.
Click through to see who has made the leap:
SEC Chairman from August 3, 2005 to January 20, 2009
In November 2011, Cox joined The Newport Corporation, "a leading global supplier of advanced-technology products and systems to customers in the scientific research, aerospace and defense/security, microelectronics, life and health sciences and precision industrial manufacturing markets."
"He brings a wealth of experience in international business, capital markets and corporate governance matters, and has extensive knowledge of the global defense and security industry. These will be invaluable assets to Newport as we continue to pursue our growth strategies and expand our presence in international markets," Kenneth F. Potashner, the chairman of the board, said in a statement.
SEC Commissioner from August 4, 2005 to January 31, 2008
Joined Summit Performance Group, a "developer of 'virtual' medical training products and services," in November of 2012.
"We welcome her help and guidance as we transition from the initial development of i-Human Patients® to hosting and supporting the service worldwide," Craig Knoche, president of Summit Performance Group, said in a statement.
SEC Commissioner from August 22, 2002 to September 18, 2007
Joined the board of WellCare in Janurary 2013. The company "provides managed care services targeted to government-sponsored health care programs."
Chairman from July 27, 1993 to February 9, 2001.
-Joined the board of Motif Investing, an online-investing start-up, in February of 2013 after advising the company for several years.
-Named as special advisor to board of directors at AIG in July of 2005
Nominated to the board of General Electric in March, 2013
"Mary Schapiro will bring valuable expertise to GE, particularly with her experience overseeing U.S. financial markets," GE Chairman and CEO Jeff Immelt said in a statement. "Her understanding of corporate governance and financial regulation will be of great benefit to GE and its shareowners. I am pleased that we have nominated Mary to our board."
The sitting head of the Financial Industry Regulatory Authority, Richard Ketchum, also serves on the board of directors of Appleseed, "a non-profit network of 16 public interest justice centers in the United States and Mexico dedicated to advancing the rule of law, promoting effective government and creating opportunities for individuals' economic advancement," according to FINRA's website.