Yahoo CEO steps down after CV embarrassment
By Michael Northcott Monday, 14 May 2012
Scott Thompson resigned over the weekend amid rumours he added a computer science degree to his CV.
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Anyone who has been economical with the truth in their CV is playing a risky game, as Yahoo’s former CEO Scott Thompson has this weekend found out to his cost: it was revealed that he falsely included a degree in computer science on his list of academic accomplishments. Questions arose when shareholders noticed that his old university did not offer the degree he had listed on his CV until four years after he had graduated.
The company’s largest outside investor, Third Point, has been lobbying for Thompson’s dismissal, and is a particularly activist group in the company. Its founder, Daniel Loeb, is now set to join the board in a management reshuffle.
Thompson resigned over the weekend, but there may be more to this story than meets the eye: he has reportedly been diagnosed with thyroid cancer in recent days, which is thought to have contributed to his decision. Having only joined the company in January, Thompson came with the promise of reinvigorating a business that is widely seen to have lost its way since the advent of Google, Twitter and Facebook. He replaced Carol Bartz, who was controversially fired by the company’s chairman in September last year after a particularly bad set of financial results. The firm has now been through four CEOs in the last two years.
One of Thompson’s flagship decisions has been to save $375m by laying off 2,000 staff (the firm employs 14,000), already making him rather unpopular in the company. But then came CV-gate, and the CEO was forced to send out a grovelling memo apologising to staff for undermining their efforts in turning the company around. The company is doing marginally better than it was: revenues are up from $1.06bn in Q1 2011, to $1.08bn in 2012.
This isn’t the only high-level resignation in the post: a number of senior executives at investment bank JPMorgan are expected to resign any day now. A storm was whipped up last week after revelations that the bank’s London trading desk had made losses of $2bn (£1.2bn) through some pretty bad trading decisions in recent months. Ina Drew, head of the bank's chief investmet office is one of the executives with her head on the block this week. Nonetheless, the firm still expects to make around $4bn in profits for Q1.
Whilst it is not surprising that CV-gate prompted Thompson’s resignation from Yahoo, the loss of another CEO is bound to create instability in a company already struggling to revive its fortunes. It doesn’t do much good for the international dissent over CEOs and their accountability in big business. The episode is proof indeed that the Internet giants are capable of falling just as quickly as they rise…