Nortel appoints new chairman

Nortel appoints new chairman

Nortel Networks named former Hughes Electronics chairman Harry Pearce as the new chairman of its board of directors on Wednesday.

Nortel Networks named former Hughes Electronics Chairman Harry Pearce as the new chairman of its board of directors following a meeting of shareholders Wednesday.

Pearce has been a director of the company since January and is a firm believer in the leadership of Chief Executive Officer Bill Owens, according to a statement from the company.

The new appointment is just one of many recent changes at the top for Nortel. Earlier this month, the company's president and chief operating officer, Gary Daichendt, resigned after disagreements with Owens over management style.

Owens took control of the company barely a year ago. His predecessor was fired as a result of an accounting scandal which forced the company to restate several years' financial results.

That scandal, and the delays in reporting of financial information that resulted, angered shareholders present at the meeting, according to press reports Thursday.

Shareholders present at the meeting criticized board members for not spotting the company's financial troubles earlier, according to the reports.

Retiring chairman Lynton Wilson told shareholders he regretted what had happened. However, the board could not have uncovered the accounting problems, he suggested; the board placed its trust in senior management and auditors to warn it of problems, and no warnings came, the reports said.

Owens thanked Wilson for his leadership and contribution to the company in Wednesday's statement.

Wilson had been chairman since November 2001. In addition to his role at Nortel Networks, he had also been a director of its principal operating subsidiary Nortel Networks since April 1991. The board recently honored him with the title "chairman emeritus" in recognition of his work.

In its annual report for 2004, Nortel signaled that Wilson and four other directors would not seek re-election this year. The other retirees are James Johnston Blanchard, L. Yves Fortier, Guylaine Saucier and Sherwood Hubbard Smith Jr.Their replacements are Jalynn Bennett, James B. Hunt Jr., John MacNaughton and Ronald Osborne.

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