When David Chicoine explains his new, part-time job — one of 11 members of the board of directors at seed giant Monsanto Co. — it all sounds very smart, very modern, very…good.
“Big companies like Monsanto,” related Chicoine in an April 21 telephone interview, “have contacts anywhere they find talent. Their only interest is high quality work.”
Chicoine’s anywhere and talent, however, are very uncommon; he’s president of South Dakota State University, the state’s Land Grant university and its premier research and teaching institution.
That makes him one of an elite group whose entire membership is fewer than that of the U.S. Senate.
It also makes him, by anyone’s recollection, the first Land Grant president to sit on the board of an agriculture-based, transnational corporation that contributes millions to fund ag research and infrastructure at Land Grant universities around the U.S.
The directorship, which became effective April 15 and is subject to shareholder approval in 2010, carries a fat paycheck for the slim work.
As Monsanto’s Form 8-K, filed April 20 with the Securities and Exchange Commission, wordily notes, Chicoine will pocket “an annual base retainer having a value of $195,000.”
Sweet, but there’s more.
“The Plan” — the non-employee pay package from Monsanto — “also provides that each non-employee director will receive a grant of restricted stock upon commencement of service…equal to the annual base retainer divided by the closing price of a share of the Company’s common stock on the commencement date.”
If my gobbleygook knife is as sharp as my math skills, that means each director knocks down an additional $195K in stock for taking on the rugged task of serving as a Monsanto director.
The almost-$400,000 Monsanto will pay Chicoine in 2009 is 100K taller than his reported $300,000-per-year salary as university prez, according to a state employee salary database maintained by the Sioux Falls (SD) Argus Leader.
More than just the pay, however, is Monsanto’s current and future ties to South Dakota State University.
The April 20 SEC filing explains that “In the ordinary course of its business, the Company has engaged in certain transactions with South Dakota State University that were, or may be, related person transactions with respect to Dr. Chicoine.”
The meaning of “related person transactions” is made clear in the next sentence.
For fiscal years 2008 and “to-date” fiscal 2009, Monsanto has paid South Dakota State University “approximately” $54,000 for “services,” donated around $367,000 in “research grants,” and been paid an estimated $216,000 by South Dakota State University for “licenses, services and goods.”
Even with those wide, green ties, Chicoine sees little possibility for conflict between his roles at the university and Monsanto.
“Whether Monsanto continues to invest (at South Dakota State University) or disinvest will be a call by the research folks at both places, not me.”
Indeed, he likens his director’s job to consulting work many professors at most public universities do for publicly-held companies.
Monsanto, he reckons, “reviewed my status as a university president,” but, “more importantly,” saw his skill as an ag economist specializing in public finance and technology transfer as key to the directorship.
Chicoine, a 1969 South Dakota State University alum who spent most of his (meteoric) academic career at the University of Illinois before returning to Brookings in late 2007, says there’s little opportunity for any conflict-of-interest between his day job and duties at Monsanto.
“Less than 11 percent of all public university money comes from private sources” like Monsanto, he says. Much of what does flow helps Land Grants “commercialize technology,” something they “are not built to do.”
Where’s the line?
Granted, but where’s the line that neither should cross? I don’t exactly know.
But I do know it’s somewhere south of the office door of our Land Grant leaders.