 |
Yahoo is not the only high-profile company dealing with a board-level shakeup.
Best Buy founder Richard Schulze has agreed to leave his position as chairman at the electronics retailer following an internal investigation that revealed he knew of former CEO Brian Dunn’s inappropriate relationship with a female employee but had not shared that information with the board's audit committee, according to several media reports.
The committee found that Dunn violated the company’s code of conduct by engaging in a "close personal relationship” with an employee, the company said in a statement. Unfortunately for Schulze, the committee also discovered that the company's founder knew about that relationship and withheld that information with the audit committee.
“In December, when the conduct of our then-CEO was brought to my attention, I confronted him with the allegations (which he denied), told him his conduct was totally unacceptable and contrary to Best Buy’s policies and everything I, and the company, stand for,” said Schulze in a statement.
The overall result means further trouble for Best Buy, which reported a $1.7 billion loss in the fourth quarter of 2011, and has announced that it will close 50 stores nationwide, according to Bloomberg.
Schulze may have been trying to protect the company that he founded, but the net loss may be far worse—for Best Buy, its investors and the overall reputation of C-suite leaders. The news will surely have an effect on a larger, troubling trend—that of declining consumer trust in corporate leadership.
A recent Hill+Knowlton Strategies study found that just 35% of Americans trust corporations to do what is right, down from 45% in 2011. Moreover, over 52% of survey respondents felt they have more access to information about the business practices of corporations, but only 30% felt like it is easier to hold companies accountable for their actions. Only 39% of Americans trust boards of directors and an even lesser percentage (30%) trust CEOs.
Follow Sahil Patel: @sizpatel