May 22, 2007
‘Is the personal life of a senior director any of my business?’
I am the CEO of a large US company. I have recently received an anonymous letter containing some controversial information about one of my directors. According to the letter he has been buying sex services of an extreme and raunchy nature. The evidence includes some incriminating photographic material so I am assuming it is genuine. This director is a trusted and talented member of my team. He is well liked and well respected in the company. What he has been doing is legal, has been done in his own time without any implications for his work. I believe strongly that an individual is entitled to a private life. However I am exceedingly concerned that if this were to get out it would impact negatively on the reputation of our company.
Well it isn’t a purely personal issue any more: it is already impacting on your business. Regardless of whether the photo is genuine there is somebody out there with the potential to harm your business and your colleague. You need to carry out some contingency planning at the very least so that if the accusations are made public you have done some thinking about your response and, while you won’t be fully prepared, you won’t be completely surprised.
Your role as CEO means that you have a duty to protect the interests of the business and its shareholders. Consider what the impact on your company’s reputation could be and how you could repair the damage. Address more than one scenario. Depending on the extent of the damage that could be done you may be better off removing your colleague from the business - any severance may be a lot cheaper for shareholders than the reputational damage. In some industries the nature of these allegations could ruin the business totally.
Two final thoughts on personal issues here. First, considering your colleague, you should warn him about the risk so that he can make his own plans for dealing with any personal fallout from publication. Second, you should not be taking all of the burden of this upon yourself. Get some support from the chairman, other non-execs or your coach. Good luck.
Consulting actuary, Male, Age 43
Posted by: Anonymous | May 23rd, 2007 at 12:10 am | Report this commentThe reason you got the letter and the photographs? Not to help you or your company, but to harm your Director. You are just one of the means the anonymous sender has to affect his victim.
Posted by: Consultant, 39, Male. | May 23rd, 2007 at 5:02 am | Report this commentIf you ignore the letter and do nothing, most likely the secret will jump out from somewhere else -most likely via his family- reducing the negative impact to your company’s reputation.
Consultant, 39, Male.
Who sent this letter and what is their motive? You need to find out because, as I see it, the real danger will come if this man’s “hobby” gets out - a danger to which you are not blind.
Worringly, perhaps the sender is another director or employee, in which case you could run into real problems if the man’s extra-curricular activites become known anyway and you are seen to have taken no decisive action. The sender clearly wants you to do something, and may take matters into their own hands if you don’t. You say that his activities are legal, but nevertheless extreme - if they become public knowledge, how much will the reputation of your company suffer? Conversely - the sender of the letter is clearly trying to force your hand - will you bend to what amounts to blackmail?
You say you don’t want to lose a talented director. Talented or not, he’s clearly made one or two nasty personal enemies along the way, and you risk losing a lot more if you sit back and ignore the issue.
Posted by: Anonymous | May 23rd, 2007 at 10:03 am | Report this commentFemale, 25, PR
You need to do a couple of things. First, I believe some kind of contingency plan is in order. You need to do some risk management; however, given that the director is not doing anything illegal, as you say, I would also give him a heads-up and let him know it may very well lead to his demise. We, unfortunately, live in a fish bowl and quite frankly, he should know better. Still, I’m appalled when I hear of CEO’s making such decisions. But that is the world we live in. I find it sad that we no longer have backbones and kowtow to the lowest common denominator of what is considered appropriate activity in our lives. People are different and we should embrace the differences, but only when it is our business to know them.
The real enemy here is not your director, it is the person using the director’s actions to make changes in the company or to, I assume, assist them in attaining a promotion. I would keep a closer eye on his department or branch. Giving the director a heads-up may help you ferret out the culprit and when you do, I’d sack him without a second thought. They may have used this tactic elsewhere within the company. It is not the actions of your director that will damage the reputation of the company. It is saboteur releasing information about the director’s activities that will damage the company’s reputation.
Attorney, 38, male
Posted by: Michael | May 23rd, 2007 at 1:10 pm | Report this commentWhat is more disturbing than the existence of the photographs and the extra-curricular activities of your colleague is the cowardly, anonymous source of this information. I would suggest that you go to the person who has been photographed and show him what you have been sent. Tell him how much you trust and value him. Tell him that what he does in his own time is his business. And then tell him to be more careful.
Jess Dunton, 27, higher education administrator
Posted by: Jess Dunton | May 23rd, 2007 at 1:11 pm | Report this commentYour over-riding concern should be for your colleague rather than the reputation of the company. You need to show him the letter and photos and then offer support and understanding because if the story gets out it could have a devastating effect on his life. He might feel that his job has become untenable.
At this point it doesn’t appear to be a business issue but a personal one. As for the company reputation, sex scandals don’t raise an eyebrow these days (in the West anyway), so don’t worry about it. As for a previous post suggesting you share with the Chairman/non-execs, you might feel you have a duty to give them a heads-up, but keep the details and the name of the individual to yourself.
Posted by: Marketing Director, 45, Male | May 23rd, 2007 at 5:03 pm | Report this commentI can’t speak for the reaction of your US customers, but if this was a company in the UK, its reputation would not suffer because of the revelation of what he gets up to in his spare time. Is BP’s reputation going to be affected for Lord Browne’s activities? What would make bigger headlines would be if it is handled badly by his bosses (ie he is fired/disciplined in some way). If it gets out it’ll be forgotten in 24 hours unless it goes to court for some reason. Do warn him that there is clearly someone out to get him. It might be wise to give a brief heads-up to other directors in case they receive similar information, but conceal his identity for as long as possible.
Analyst, 30, female.
Posted by: A. Anderson | May 25th, 2007 at 8:36 am | Report this commentYes of course an individual is entitled to a private life. I believe that too, and so do most people – though the person who sent the pictures clearly thinks otherwise. Thanks to him your director’s life isn’t private any more. And unless you do something it may soon become considerably less so.
Posted by: lucy kellaway | May 28th, 2007 at 6:37 pm | Report this commentI can see that the best thing for you would be to put the beastly things into the bin and try to forget you ever saw them. Which may be quite hard next time you find yourself confronted with the man himself.
But you can’t do that for two reasons. The first is that there is, as you say, some risk to the reputation of your business. It is quite sick-making that this is so, as of course his sexual proclivities should have nothing to do with the business at all. The trouble is that if the pictures are quite shocking, and the company well known they could well find their way into one of the more prurient newspapers on some spurious grounds or other. Athough that probably wouldn’t damage your company’s reputation badly or for long, it would be the sort of publicity it might be nice to avoid. It depends a little what sort of business you are in – the more squeaky clean the company’s image, the worse the headlines would look.
The second is the risk to the man himself, to his family life and to his reputation. I don’t envy you the conversation that you are going to have with him – it’s going to be horribly embarrassing for both of you. But you need to show him the letter and the pictures so that he can protect himself as best he can.
You both need to think who might have sent them. You need to think how you are going to react if they get out. You need legal advice on injunctions – not that this route did Lord Browne any good.
In all I pity you. This is a wretched business, and I imagine not what you went into management for. However if this guy is as good as you say he is, this is your chance to do him a good turn by dealing sensitively with this. You may earn his undying loyalty.
Your director may have done nothing illegal, but he has shown a serious failure in judgement (and possibly in morality) in getting himself into this situation. You need to review if you really do need a guy like this on your executive team. In my experience of three decades of senior management, the best leaders are ones who live the company’s values in their private life as well as in their working life.
Posted by: Director, male, 62 | May 28th, 2007 at 6:45 pm | Report this commentThis thread proceeds on the assumption that the director’s buying of sex is a private matter which does not and will not affect his work. I am not persuaded of this. If this man is married/in a relationship, there is a good chance that he is lying about his use of prostitutes. Is it desirable to have a director who regularly or perhaps daily deceives someone who loves him? If he can lie systematically to one person, does that not make him more likely to lie to others?
Posted by: John, lawyer, 29 | May 29th, 2007 at 1:24 pm | Report this commentIt shows the most appalling judgement both on the part of the director and the anonymous informant. Additionally the director has broken the law in paying for sexual services. You need to sort this out by confronting them and eliminating both people from the company. Who knows what else they have got up to, and who else they have harmed?
Posted by: Anonymous | May 30th, 2007 at 1:06 pm | Report this commentTo the last post, what may be questionable in the US is not necessarily illegal in other places.
I can’t help but think about Steve Jobs, Apple, and the backdating of stock options. Of course Apple would continue even if Jobs was asked to leave; Jonathan Ive would be a great choice.
But I can’t help but think that this excuse of “expediency” from others to get the director out the door before he stains the reputation of the company is just that, an excuse.
People are grownups and I’ll trust them to understand there are boundaries between work and private lives. Auditors would uncover any discrepancies in the company if there were any. Frame it that way if it gets to be a public issue.
The CEO should have a talk a with the director about how to handle it, but I would not ask him to leave based on the information provided.
Posted by: Dominick, 50, Business owner | May 31st, 2007 at 12:17 am | Report this commentObviously someone has a grudge against this individual. I think the CEO needs to give his full-hearted support to the executive, and also try to investigate the source of the blackmailer. As far as containing the negative PR, it might be advisable to give the PR department a heads up as well.
Posted by: Manager, Male, 40 | June 3rd, 2007 at 5:11 pm | Report this commentPut the evidence back in the envelope and forward it on anonymously to the guy in question. After all, he stands the best chance of working out who the material has come from. Who knows, it might be his wife wanting to get her own back…
Posted by: Male Banker, 43 | June 5th, 2007 at 8:53 am | Report this commentYou have answered yourself by agreeing that if it goes out open will damage your company’s reputation. Though it is personal and legal but is not generally expected when some one is in very responsible position. So you need to act for the sake of your company’s reputation. It may be sabotage with the help of all modern technology so better to be open and frank.
Posted by: Male, 45, CFO | June 6th, 2007 at 4:22 pm | Report this commentThere is a serious possibility that the letter is of part of a criminal blackmail attempt. You need to speak to the director, show him the letter and photographs and ask if he knows who sent them and if he has been put under pressure by anyone who might have obtained the photographs. You need to preserve the letters as evidence and to consult the company’s legal advisers over the possible need to involve the police. The possible corporate reputation damage from a company director buying legal sex services in his own time, is a lot less than the damage that would be caused if the company’s CEO were arrested for failing to report the serious crime of blackmail.
Posted by: Ironybrew, 57, Retired, Male | June 7th, 2007 at 10:56 am | Report this commentThe legal advisers should also be asked to provide advice on the best ways to preserve the right of both the director and the company to privacy. If it can be proved that the letter was sent by another company employee, then that employee should be sacked, ironically for “gross misconduct” at work.
Just tell him someone is trying to damage him and possibly the firm’s reputation, he must be careful with his personal life. If he asks for evidence show it to him - after some reluctance. Show empathy and hope for the best. Be careful not to appear to be involved in the snooping. Tell him if the story comes out you’d have to act in the best interests of the company.
Posted by: Joseph, Quanity Surveyor, Age 39 | June 27th, 2007 at 9:43 am | Report this commentReading the question I couldn’t stop but wonder: what if the photographs are fake?
Posted by: selma | February 14th, 2008 at 8:18 pm | Report this commentWhat if there is really someone sick out there trying to frame this person?
This is why I think a discussion behind closed doors is required in order to asses how to handle the situation and how to act with the company interests in mind.