Longtime friends face public scrutiny

A product of a patrician family and Princeton, Gifford is the more garrulous, long the civic face of Boston’s business community. May is from middle-class Connecticut and modest Stonehill College, and despite his outwardly quiet demeanor, is known as a formidable executive.

Gifford sold the most Brahmin of Boston banks to its regional rival, and then sold its successor to a pillar of the New South, Bank of America Corp. May rose to the top of Boston Edison, now NStar, keeping the company independent and earning a reputation as a master number cruncher.

The two served on each other’s boards, becoming close professionally and personally, rising to a pinnacle of the business world as board members for Bank of America. Now they find themselves at a crucial moment in the bank’s life, yet in an odd situation: They are among the select group of directors who will pick the bank’s new chief executive, a key step to restoring the bank’s credibility. At the same time, they’ve also been singled out by Congress to testify about Bank of America’s purchase of Merrill Lynch & Co. at an upcoming hearing.

The hearing is Nov. 17. Meanwhile, the bank’s six-member selection committee is expected to pick a successor to retiring CEO Kenneth Lewis in the next few weeks.

Harvard Business School professor Jay Lorsch said Bank of America’s situation is the kind that motivates career executives like Gifford and May to prove they’re up to the task.

“Sometimes the best boards are the ones that recover from things that have gone wrong,’’ he said. “If something gets screwed up, board members might start to feel it’s their job to fix it.’’

Fixing Bank of America is no small task. The bank got more than $45 billion in federal bailout money last year and another $20 billion to help it absorb Merrill Lynch’s mounting losses. Lewis surprised even his own board a few weeks ago when he abruptly announced he would retire at the end of the year. He will leave a bank that is under investigation by congressional and state officials, while it is still assimilating the acquisitions of two sizable but troubled companies, Merrill Lynch and Countrywide Financial.

May, 62, and Gifford, 66, declined to speak publicly about their roles. The two have become close over the years, their friendship is at the point where they can needle each other with profanities over e-mail. They have also together withstood major tests of their respective industries, as the utility world was deregulated and banking went from a hometown lending business to global financial provider.

“This is no Johnny-come-lately friendship,’’ said Jack Connors, a former Boston advertising executive. “These guys have been playing in the same sandbox a long time.’’

Gifford is among the most seasoned bankers on Bank of America’s board; May is the only certified public accountant on the board and serves as chairman of the its important audit committee.

When Lewis was considering May as the audit committee’s chairman, a position that requires more work and carries more responsibility than most other director jobs, he sought out Gifford, who enthusiastically endorsed his friend’s appointment.

Others credit May with shrewd analytical skills.

May is “just very good in a board room,’’ said one acquaintance, a utility industry insider who has worked with May but did not want to be identified. “He’s someone who is very risk averse, very measured, and aggressive in an extremely careful and subtle way. He never picks battles he’s not going to win.’’

Well known in the business community, May steered NStar through deregulation in the 1990s in his day job, while on the side raised record-breaking sums for charities such as United Way. But he also avoids the limelight. In a 1994 Globe interview, he said he had no “goal of visibility or of Boston leadership.’’

“I’m not a personality that thrives on attention,’’ he said.

Indeed, longtime friend Kevin C. Phelan described May as “lovably dull.’’

Phelan, president of the commercial real estate firm Colliers, Meredith & Grew, said he once tried to persuade May to buy a vacation home in an upscale Cape community, such as Harwich or Osterville.

“The price point was a little rich, and he could afford it in a blink.’’ But, Phelan said, May replied: “ ‘No, I don’t need that showiness.’ ’’

As for Gifford, Lorsch, the Harvard Business School professor, said he is “a very prominent and well-thought-of banker and there are a lot of people that have told me he knows more about what’s going on at Bank of America than anybody else.’’

Now, their relationship has become something of a public matter. As part of their investigations of the Merrill deal, both New York Attorney General Andrew Cuomo and the US House Committee on Oversight and Government Reform subpoenaed documents of Bank of America directors.

One of the documents that has surfaced is an e-mail exchange between Gifford and May during a crucial moment in the Merrill saga - while on a conference call with other directors to discuss cutting Bank of America’s dividend, and the $20 billion in additional federal money.

At one point during the call, Gifford typed to May: “Concentrate on the phone!!!’’

“Screw you,’’ May responded.

“Unfortunately it’s screw the shareholders,’’ Gifford quipped back. (As a former executive, Gifford has much of his wealth in Bank of America stock, and so would see a large drop in income from the dividend cut.)

Looked at one way, it appears to be two are sharing dark humor during a crisis. But congressional investors want to know if the exchange had more far-reaching implications, and have called the pair to Washington next week to explain in more detail.

Lorsch said the e-mails portrayed Gifford and May “acting like a couple of schoolboys.’’

“Any Bank of America board member has to be thoughtful about how they maintain appearances,’’ he added. “That is where they get a little sloppy. Sloppy in the sense that the rules, the understanding of independence and distance and objectivity’’ were compromised.

May and Gifford first became acquainted in the 1990s, when Boston’s business community was an insular realm and the heads of the major local companies routinely served on one another’s boards. Gifford has been a director of NStar since 1990, when it was named Boston Edison.

May joined the board at Bank of Boston Corp. in 1994, a year before Gifford was promoted to chief executive. When Gifford later sold the bank to Fleet Financial Group, he chose May as one of the directors to join the newly merged institution. And when Gifford sold Fleet to Bank of America in 2004, May again moved along with him.

Gifford is the son of Clarence H. Gifford Jr., former chief executive of Rhode Island Hospital Trust National Bank. His mother, Priscilla Marshall Kilvert Gifford, was a direct descendent of one of Rhode Island’s founding families, the Browns.

“Chad’’ Gifford, as he is known, joined Bank of Boston in 1966. Over the years he led the Greater Boston Chamber of Commerce and several high-profile campaigns to desegregate Massachusetts schools and improve public education.

“He’s an outgoing, open person, and he viewed his role at the bank in part as a public role,’’ says Paul Guzzi, the Boston chamber president. “Chad came out of a tradition in which he had a dual role as the head of the bank but also someone with a social civic responsibility because of that position.’’

May met his wife at Stonehill College, earned a master’s degree in finance from Bentley College, and then worked for the accounting firm Cooper’s & Lybrand, where Boston Edison was a client. In 1976, he joined the company as an assistant treasurer and became chief executive in 1993. At age 46, he was the youngest boss in Boston Edison’s history.

Paul La Camera, the general manager of WBUR who has served on the NStar board for a decade, characterized him as driven.

“He was a kid out of Hartford who overachieved as a young person,’’ La Camera said. “He came from a very modest background, and by dint of hard work, graduated with excellence.’’

Now Gifford and May face some of the biggest decisions in their professional lives.

Said Cornelius Hurley, director of the Morin Center for Banking and Financial Law at Boston University: “Both Gifford and May are playing important roles in the bank’s future and, by extension, the health of the financial system.’’

Megan Woolhouse can be reached at mwoolhouse@globe.com; Steven Syre at syre@globe.com.