IMHO the activist shareholders were the key decision makers in this story. The key I believe was the following. "The surging value of those investments [Alibab

IMHO the activist shareholders were the key decision makers in this story. The key I believe was the following. "The surging value of those investments [Alibaba and Yahoo Japan] — not any brilliant business moves by Ms. Mayer — is why Yahoo’s shares went up....managing those investments was a key reason that Yahoo’s board hired Ms. Mayer...Ms. Mayer delegated the Alibaba issue, hiring an experienced dealmaker, Jacqueline Reses, to be the company’s principal liaison to Alibaba and its leaders, Jack Ma and Joseph Tsai. Ms. Reses helped the Chinese company navigate its initial public offering. She also renegotiated an agreement, struck just before Ms. Mayer arrived, that would have forced Yahoo to sell an additional 122 million shares in the offering. Those extra shares are now worth $15 billion." Those two acts---knowing how to find Reses, and knowing how to delegate to Reses---combined with finding a buyer, were what made Mayer's compensation palatable to those activist shareholders. Those shareholders considered Mayer an enablement platform like a smartphone app store, and for the value "unlocked" enabling the shareholders to cash out, they were willing to pay the enablement fee. For a fee far lower than 30% of what they unlocked, they probably considered it well worth paying. That unlocking the value meant effectively dismantling Yahoo was incidental for the decision makers. I think the moral of the story for me personally is if I ever find myself within a company where activist shareholders successfully get on the BOD to "increase shareholder value" in any manner that smells of selling off all or the most profitable/highly-valued parts of the company, then I will send out my resume (always maintained and updated) and update my availability status. I'd like to hear contrary viewpoints, though.