Yahoo CEO Marissa Mayer said: "This constructive resolution will allow management and the board to keep our focus on our extremely important objectives.
"Management is looking forward to working with the entire board, including the new directors, to maximize shareholder value."
Smith, who will also join the strategic review committee, said: "We look forward to getting started right away and working closely with management and our fellow board members with the common goal of maximising value for all shareholders."
The other new additions to the board are Tor Braham, a former technology investment banker at Deutsche Bank; Eddy Hartenstein, a director of Tribune Publishing and former CEO of The Los Angeles Times; and Richard Hill, chairman of Tessera Technologies.
The move avoids a proxy war and may increase the prospects of the divestment of Yahoo assets, a process that started in February.
Yahoo has failed to meet the varying consumer requirements and advertising techniques, losing revenue to its rivals Twitter, Facebook and Google.
The company has been looking for a buyer for its core operations since earlier this year. The operations continued to decline in the last four years under Mayer.
Verizon Communications, the UK’s Daily Mail, TPG Capital, Bain Capital, Vista Equity Partners Apax Partners, Apollo Global Management and Warburg Pincus are among the bidders.
The Daily Mail has however denied that it has submitted bids to buy Yahoo, yet sources say that it is still in talks with several parties to partner in a potential buyout of the US tech giant.
Yahoo posted a first quarter loss of $99m following a sharp drop in net revenue. When compared to the same quarter last year, the web giant’s net revenue dropped 18% to $859m – the largest drop in net revenue since Mayer was hired four years ago.
This article is from the CBROnline archive: some formatting and images may not be present.
Join Our Newsletter
Want more on technology leadership?
Sign up for Tech Monitor's weekly newsletter, Changelog, for the latest insight and analysis delivered straight to your inbox.