![]() Netflix’s Jonathan Friedland. Intel’s Brian Krzanich. Ford’s Raj Nair. Companies act swiftly nowadays. Businesses are finding they must deal quickly and decisively with inappropriate behavior in the workplace in a way they never had to before. What once took months or years to address has been accelerated by the increasing influence of online consumer advocacy groups, the role of social media in people’s lives and the #MeToo movement. On Friday, Netflix Inc. NFLX, +5.10% announced it had let go of chief communications officer Jonathan Friedland due to his use of a racial slur on at least two occasions. Intel Corp.’s INTC, -2.27% chief executive Brian Krzanich resigned Thursday after the company found he had violated the company’ non-fraternization policy by having a past consensual relationship with another company employee. Nair, a Ford Motor Company F, +0.39% veteran who ran the company’s North American business, left after an investigation found his behavior was inconsistent with the company’s code of conduct, though Ford did not provide details on the nature of his behavior. Read: Intel must do something it has never done after inglorious exit for CEO “Companies are looking at a new set of best practices,” said Davia Temin, chief executive of Temin & Co., a New York-based reputation and crisis-management firm. “The old set would have been to close your eyes, ignore it and hope it goes away or that no one notices,” she said. These new standards are causing some big changes at the top. See also: Time magazine names ‘The Silence Breakers’ 2017 person of the year The percentage of CEOs forced out of office for ethical problems is on the rise. In a study published last year, PricewaterhouseCoopers found CEO dismissals for ethical lapses increased by 36% between the five-year period ending in 2011 and the same span ending in 2016. And with the recent #MeToo movement gaining traction, the number is likely tracking even higher. Ethical lapses haven’t necessarily increased, but firings have, said DeAnne Aguirre, a principal with PwC in the U.S. and co-author of the report. She expects the number of such firings to continue to rise. At least 416 executives and celebrities have been accused of sexual misconduct since December 2016, according to a data collected by Temin’s firm. The majority of Temin’s list consists of corporate executives, though it does include celebrities like Bill Cosby and Kevin Spacey. Over the past 18 months, 195 have resigned or have been fired and 118 have been suspended, placed on leave or are facing legal repercussions without permanent removal. Read now: Kevin Spacey scandal cost Netflix $39 million Related: Pixar head John Lasseter to leave Disney in wake of #MeToo Social media has made companies “ultra-porous,” said Temin. Nowadays, little can be kept private, and word of misconduct spreads quickly among online networks. There is also added pressure from consumer activism groups like Grab Your Wallet and Sleeping Giants, which publish CEOs’ names and email addresses for followers to contact. “The degree of accountability for one’s behavior around cultural sensitivity and around gender issues and other issues has heightened enormously,” Temin said. CEOs and other C-suite executives are often the public faces of the company, which forces companies to move quickly when they behave inappropriately, said Brayden King, a management professor at Northwestern University’s Kellogg School. “The public and the employees of the company take what these executives say as a reflection of the company’s culture and values,” he said. And everything is fair game, even what they say in private. Once social media catches wind of an executive displaying inappropriate behavior, people automatically associate it with the company and word can spread like wildfire. “There’s very little space now between what is personal and what is public for these executives,” said King. Netflix shares have gained 107.3% so far this year. Intel shares are up 8.7% and Ford shares have slid 7.2%. The S&P 500 SPX, +0.47% has gained 1.8%. Read More Netflix, Intel ousters show companies are moving fast to tackle exec misconduct : https://ift.tt/2N1vovQ
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January 2020
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