Before his decision to resign on medical grounds or perhaps on falsified degree scandal, the ousted CEO of Yahoo, Scott Thompson, was successful enough to put the long struggling company on the success track with earnings of 23 cents per share, within a short period of five months. Yahoo, Director, Patti Hart had already resigned last week from the board after accepting his failure to checks the resume of Mr. Scott Thompson.
54 years old Thompson, the ousted CEO of Yahoo, the Sunnyvale California-based Internet company, started telling the board members and several of his colleagues during the last week that he had been diagnosed with thyroid cancer before resigning as chief executive officer of Yahoo.
The analysts believe that the decision by Scott Thompson to step down from the post of CEO seemed to be partly influenced by his cancer diagnosis but the board investigations about the ‘erroneously included’ computer science degree in his academic record were the major cause.
Daniel Loeb (controlling the 5.8% of Yahoo through Third Point Capital hedge) was demanding the change in Yahoo since the brutal removal of Carol Bartz over phone. He sent a letter to Yahoo that Scott Thompson’s official Yahoo bio, stating that he earned the computer science degree from Stonehill College, Easton, Mass., was not true. Then the Third Point hedge fund started to demand the replacement of Yahoo CEO, Mr. Scott Thompson, by blaming that Thompson might be using the false credentials for years.
After the demand from the Third Point, Yahoo admitted that actually Thompson received a degree in accounting but this was termed as the Computer Science Degree in a regulatory statement, filed by Yahoo to the Securities and Exchange Commission, in late April but was disclosed on May 3.
Burst of controversy forced Thompson to decline the allegation twice while speaking to employees by saying that he did not know anything about the error until pointed out by Third Point. But, lastly on Friday, an executive-search firm (Heidrick & Struggles International Inc. which had arranged Thompson’s placement as CTO of eBay Inc.’s PayPal unit in 2005) fired the last round of shells by disclosing that the evidence available with them appeared to be contradicting the claims by Thompson.
The successful looking era of Scott Thomson ended at Yahoo when he agreed to leave Yahoo on Saturday, to be replaced by Ross Levinsohn, a senior Yahoo executive, as the interim CEO of Yahoo. After, Thompson and Hart, former chairman Roy Bostock also quit to be replaced by Fred Amoroso as New Chairman.
All this happened despite the hell of protests at media that he was not an internet company man. Even, he himself was quoted to have said that he had no vision of an informed opinion on display advertising. He was placed as the CEO of Yahoo despite the fact that company directors wanted a person to rebuild the company, not to sell it. Despite the fact that he was declared an unsuitable person for the post of CEO but still his era at the Yahoo saw a return to the financial gains.
Now, will Ross Levinsohn, aged 48, be able to run Yahoo on solid footings depends upon the future. Ross Levinsohn is expecting permanent appointment as CEO as favored by Fred Amoroso, the company’s new chairman, who has said that he wanted to see Mr. Levinsohn as the permanent CEO.
Removal of Mr. Scott Thompson, whether on Medical or Moral grounds was a case of high moral grounds. Third Point deserves salutes for the moral stand on the false claimed degree of Mr. Scott Thompson. Such dedication as shown on the case by Third Point is a rare event in the Corporate World where the financial gain is treated as the final test of the success of the chief executive officers. Future of America looks to be bright if such dedication is frequently repeated in the Corporate America. It was also a test case for the global corporate and moral image of Yahoo. The other wise decision would had destroyed the very credibility of the Yahoo, a step toward corporate suicide.