However, according to reports, it is understood the move is unlikely to appease Icahn, who has built up a 5% stake in Yahoo in recent months and is believed to be seeking a minimum of four seats on the board.
Having four out of nine seats would probably give Icahn enough control to push through the changes that he wants to make, such as getting Yahoo back to the negotiating table with Microsoft, following a series of on-off takeover talks with the software giant.
However, observers doubt whether Icahn would be able to work alongside Yahoo founder and chief executive Jerry Yang, whom Icahn has said he wants to replace.
News of Yahoo's Icahn bid comes as speculation mounts that Yahoo has renewed talks with Time Warner's AOL in recent weeks.
Following the breakdown in talks over a possible $44.6bn takeover of Yahoo by Microsoft in May, Yahoo has sought to appease concerned investors by unveiling a string of initiatives.
Last month, it struck a deal with Google in which Google's paid-for search results are shown alongside Yahoo's natural results. Yahoo claims it will earn up to $450m (£227m) from the tie-up.
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