Who would have guessed that the CEO of Yahoo (NASDAQ:YHOO) actually would be a real yahoo himself, which is defined by the dictionary as “an uncultivated or boorish person” — and who is overseen by an even bigger bunch of yahoos?
Indeed, the yahoos running Yahoo have a serious problem on their hands. CEO Scott Thompson was caught padding his résumé by activist investor Third Point LLC, which has launched a proxy fight with the Sunnyvale, Calif., company. Thompson, who joined Yahoo last year from eBay’s (NASDAQ:EBAY) PayPal, claimed for years to have degrees in accounting and computer science from Stonehill College.
Unfortunately, he only has a degree in accounting.
“Stonehill College informed us that it did not begin awarding computer science degrees until 1983 — four years after Mr. Thompson graduated,” read Third Point’s letter to the board, released yesterday. “… We learned that during Mr. Thompson’s tenure at Stonehill only one such course was even offered — Intro to Computer Science. Presumably, Mr. Thompson took that course.”
At first, the yahoos running the appropriately named company hunkered down and defended Thompson for what they considered an “error.” Now, according to Kara Swisher of AllThingsD, the board will review the situation. This presumably means Thompson is on his way out the door.
Anyone who has applied for a job in the U.S. in the past 50 years — whether it’s washing dishes or running a Fortune 500 company — knows that lying on your is grounds for immediate dismissal. Yahoo’s policy is no different. The board has absolutely no choice but to boot Thompson; if it lets him stay, it will open a gigantic legal can of worms. Anyone who Yahoo has fired for padding their résumé would be able to sue the company for applying policies differently to the CEO than everybody else. Awarding him any severance also would create a horrible precedent.
Rules are rules, even for CEOs, as several learned the hard way in recent years. RadioShack (NYSE:RSH) CEO David Edmonson resigned in 2006 after evidence was uncovered that he lied about his educational background. Four years earlier, Kenneth E. Lonchar resigned as CEO of Veritas Software after he lied about having an MBA from Stanford University. Veritas, by the way, is Latin for “truth.”
Some CEOs do survive these blunders, such as Bausch & Lomb CEO Ronald Zarrella, who also lied about having an MBA. The eyecare company did rescind his bonus in 2002 as punishment, but he remains on the job today.
However, that case appears to be the exception rather than the rule.
Even academics get busted for these sorts of fibs. Doug E. Lynch recently resigned as a vice dean at the University of Pennsylvania School of Education after the Philadelphia Inquirer found he had falsely claimed to have a doctorate from Columbia University.
For Yahoo shareholders, the fact that the company did not catch Thompson’s rather blatant lie is depressing — and it raises questions about his character because people rarely lie about one thing.
Luckily for Thompson, he has such a strong track record running PayPal that he will be unemployed for 20, maybe 30 seconds after leaving Yahoo, proving that lying isn’t a career-killer for some.
As of this writing, Jonathan Berr did not hold a position in any of the aforementioned securities.