Yahoo confirmed Friday that new chief executive Scott Thompson does not have a computer science degree and that the company's board is looking into the matter.
Thompson’s biography and Yahoo filings with the Securities and Exchange Commission both list that Thompson has degrees in accounting and computer science. But an activist Yahoo investor called the computer degree into question in a scathing letter to the company’s board on Thursday. After first calling the discrepancy a mistake, the board has started an investigation.
“[Upon] completion of its review,” the company said in a statement, the board “will make an appropriate disclosure to shareholders.”
In his letter to the Yahoo board, Dan Loeb, whose company ThirdPoint owns 5.8 percent of Yahoo shares, said: “A rudimentary Google [emphasis original] search reveals a Stonehill College alumni announcement stating that Mr. Thompson’s degree is in accounting only. That announcement is consistent with other documents (including filings with the SEC) that reflect Mr. Thompson received a degree in accounting, but not computer science,” Loeb wrote in the letter.
Thompson joined Yahoo in January, leaving his job as president of eBay’s PayPal division. He replaced interim Yahoo chief executive Tim Morse, who had taken the role after the September firing of Carol Bartz.
According to a report from Business Insider, Thompson’s extra degree has shown up on biographies of the executive as far back as 2008, though it never appeared on SEC filings for PayPal. Yahoo has since removed references to Thompson’s computer science degree from his official Yahoo biographies.
If the accusations are true, Loeb wrote, then it casts serious doubt on Thompson’s personal and professional reputation.
“If Mr. Thompson embellished his academic credentials we think that it 1) undermines his credibility as a technology expert and 2) reflects poorly on the character of the CEO who has been tasked with leading Yahoo! at this critical juncture,” he wrote. “[In] the event that there is no good explanation, we expect the Board to take immediate action.”
Before he was hired at Yahoo, Thompson wasn’t on many analysts’ short list for the CEO position. But Yahoo touted his technological experience as president of PayPal, where he also served as chief technology officer. A report from All Things Digital revealed that Thompson had approached Yahoo about the job. He took matters into his own hands, the report said, because the firm leading the search for Yahoo had placed Thompson at PayPal and so could not poach him from that position. The report said the vetting process that followed was “very quick.”
Loeb has been a gadfly at the Internet company, lobbying for more power on the company’s board, and had offered four names for consideration when the company chose new members for its board in March. He later said that he would drop his push for his candidates if Yahoo allowed him on the board — an offer Yahoo declined, The Washington Post reported.
Regardless of how the situation shakes out, this is likely a major blow to Thompson, who recently laid out his plan for how to turn the aging technology firm around. In the company’s last earnings call, Thompson said he planned to streamline the company’s products and reduce costs, in part, by laying off 2,000 employees.
If Yahoo does choose to lay off Thompson, it will have to find yet another person to lead the company — its fourth in under a year.
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