Yahoo is weighing its options Monday after activist investor Daniel Loeb threw a major wrench into chief executive Scott Thompson’s plans to turn the company around.
On Thursday, Loeb publicly accused Thompson of claiming a false computer science degree on his corporate biographies and Yahoo Securities and Exchange Commission filings. On Friday, he set a deadline for Yahoo’s board to dismiss Thompson — Monday at noon. Whether Yahoo will even acknowledge that deadline from Loeb remains to be seen, but the company’s top executives seem to be standing behind Thompson for the moment.
According to All Things Digital’s Kara Swisher, Thompson told top staff that he blamed a “personal vendetta” for the controversy but reportedly did not address the fact that Yahoo was forced to admit that Thompson did not, in fact, earn a computer science degree. On Friday, he reportedly sent a memo asking all employees to “stay focused” on their work, and referred to a company statement saying the board was “reviewing the matter and, upon completion of its review, will make an appropriate disclosure to shareholders.”
The firm’s handling of the situation has raised questions about how investors and Yahoo employees will react if Thompson doesn’t explain how the incorrect degree ended up in his biography in the first place, Swisher reported.
This is certainly not the first time that a chief executive’s qualifications have been questioned. Lotus chief executive Jeff Papows had to resign in 2000, ZDNet notes, in part because he claimed he had received a PhD from Pepperdine University when he had not. (Papows also apparently lied about his military record and his skills in tae kwon do, according to a 2000 CNet report.)
RadioShack chief executive David J. Edmondson also resigned in 2006, The Washington Post reported after questions were raised about the accuracy of his résumé. In that case, Edmonson initially had the support of the board, the report said, but eventually agreed to resign after a week of protest.
The main issue appears to be the way Thompson has handled the situation as opposed to questions about whether a computer science degree is required for his position — degrees don’t always carry much weight, particularly in technology, where college dropouts are some of the most prominent members of the community.
While Loeb and others have said that the lack of a computer science degree calls Thompson’s technical qualifications into question, Swisher’s report seems to confirm that the dustup is mostly about principles.
Yahoo, which has been tight-lipped about the whole affair, did not immediately respond to a request for an update on the situation.