Kenneth Chenault Joins Airbnb, Another All-White Tech Company Board. Is He Going Overboard?

Written by Dana Sanchez

Last week, Kenneth Chenault made history as the first African American to be named to Facebook’s board of directors.

This week, it was announced that outgoing the American Express CEO Chenault is joining Airbnb’s board as well, making him the first African American to join its all-white all-male team.

The second-most-valuable startup in the U.S. after Uber, Airbnb is preparing for an IPO. The short-term rental site is valued at $30 billion, according to data from CBInsights, Fortune reported.

Airbnb reached full-year profitability for 2017 with $100 million in cash-flow profit, setting the company up for a 2018 IPO.

Kenneth Chenault
Kenneth Chenault joins Airbnb board of directors. Photo: LinkedIn

In addition to Facebook and Airbnb, Chenault serves on the boards of IBM and Procter & Gamble, and nonprofits  including the Arthur Ashe Institute for Urban Health. A philanthropist, he helped raise money for the National Museum of African American History and Culture.

Board directors enjoy high-paying work. Their pay has skyrocketed in the past 15 years, with some directors now earning more than $1 million for a single board, according to a Boston Globe report.

Despite pressure to add more African Americans and women to boards of directors, they have been historically excluded from tech company boards, which remain dominated by white men.

Chenault is Airbnb’s first independent board member. The short-term rental site has promised to make its next board hire a woman, Fortune reported.

Airbnb’s board currently consists of its three founders — Brian Chesky, Nathan Blecharczyk, and Joe Gebbia — plus venture capitalists Jeff Jordan and Alfred Lin. Women rumored to be coming onboard at Airbnb include politicians Condoleezza “Condi” Rice and Valerie Jarrett, former GE executive Beth Comstock and former Hewlett Packard Enterprise CEO Meg Whitman (now a Hollywood mogul). Recode reports that sources say these are not the names under consideration.

Chenault will join the Facebook board on Feb. 5, 2018. Its members include CEO Mark Zuckerberg; Marc L. Andreessen of Andreessen Horowitz; Erskine B. Bowles, president emeritus of the University of North Carolina; Susan D. Desmond-Hellmann, CEO of the Bill and Melinda Gates Foundation; Reed Hastings, chairman and CEO of Netflix; Jan Koum, founder and CEO of WhatsApp; Sheryl K. Sandberg, chief operating officer of Facebook; and Peter A. Thiel of the Founders Fund.

Jonathan Miller, former AOL chief, served on the boards of eight publicly traded companies in 2015, according to a Boston Globe report. It’s a problem sometimes called “overboarding.”

Boards of directors earn far less than CEOs, but compensation for board service can be in the half-million dollar range or more, according to the Harvard Law School Forum on Corporate Governance and Financial Regulation.

The median annual retainer for directors was $245,000 in fiscal year 2016 for companies in the Equilar 500—an index of the largest U.S. companies by revenue. That’s up almost 20 percent over a five-year period, according to the Equilar report, Director Pay Trends.

Equity awards have become more common for board members, and as a result, dollar values for director pay have increased.

Below is a list of the highest-paid boards of directors at large-cap companies, based on annual retainers awarded to all non-employee directors, according to Equilar data.

When Chenault was named CEO of American Express in 2001, he became the third black person to run a Fortune 500 company.

He is one of the longest-serving black CEOs of a major U.S. corporation and a veteran of an industry dominated by white men in its top management ranks, USA Today reported.

Civil rights leader Jesse Jackson has been lobbying for years to add people of color to Facebook’s board of directors. Diversity remains a top challenge for Silicon Valley companies.