The Chief Executive of Yahoo Scott Thompson has quit his job after he was accused of having a fake accounting and computer science degree, which was also included in his CV and Yahoo’s financial reports. He is being replaced by Ross Levinsohn who is currently Yahoo’s global media head. Levinsohn will take the CEO’s responsibility on a temporary basis until the board of directors decides on the new CEO.
This is another bad news coming
from the company headquarters in Sunnyvale after it announced, a month ago,
that it was going to lay-off 2000 employees. Yahoo has been facing severe
competition from Google and Facebook and has witness dwindling profits in the
extremely competitive environment. After joining Yahoo, Thompson had adopted a
severe cost cutting strategy that included the lay-offs and several management
changes. He was able to increase the company’s revenues after a gap of nearly
three years.
Prior to joining Yahoo, Thompson
was the President of online payments at PayPal. He joined Yahoo in January and
was the third CEO in approximately three years. He replaced Carol Bartz who was
fired in September, 2011.
He had earlier claimed that he
did not possess the accounting and computer science degree but it was his head
hunting firm, Heidrick and Struggles’s fault that had included the information
in his CV when he joined PayPal in 2000. Heidrick and Struggles had denied the
allegation stating that the degree in question was a part of the CV that
Thompson had submitted to the firm.
Daniel Loeb, a hedge fund manager
and Yahoo’s shareholder, discovered the chief’s fake degree and launched a
campaign for his removal. Loeb, who heads the Third Point investment fund which
owns 5.8% of the company’s shares, also notified the Securities and Exchange
Commission of Thompson’s embellishment.
Yahoo has already officially
stated that its CEO did not have a computer science degree.
Following the news, Yahoo is set
to change its executives and some new faces are going to join the board of
directors. Leob had suggested four new names, including himself, out of which
Leob, Michael J Wolf and Harry Wilson will join the board. Five existing board
members, who were due to leave in the current year’s annual general meeting
will also resign by Wednesday (16th May).
In its recent statement to the
press, the company announced, “The board is pleased to announce these changes
and the settlement with Third Point, and is confident that they will serve the
best interests of our shareholders …… “
Your comments and feedback are always appreciated.
Sarfaraz A.K.
sarfaraz@when.com
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Sarfaraz A.K.
sarfaraz@when.com
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