Directors Take Note: High-profile misconduct can impact a company's bottom line
By April Hall
The firing of Today show’s anchor Matt Lauer over sexual harassment allegations could lead to millions of dollars in lawsuits and loss of ad revenues for NBC News’ parent Comcast, according to some reports.
In hindsight, company executives are taking a strong stand. “A team of the most experienced NBCUniversal Legal and Human Resources leaders have begun a thorough and timely review of what happened and what we can do to build a culture of greater transparency, openness and respect for each other,” said Andrew Lack, chairman of NBC News, in a memo to staffers sent out late last month.
But was the issue on the radar screen of Comcast’s board directors before news broke of the Lauer scandal given how such situations can impact the bottom line?
A request to Comcast to answer this question was not immediately responded to; but if they did address the issue before it would make the company an outlier.
Turns out it’s not a common discussion in the nation’s boardrooms.
Most boards of directors haven’t even talked about sexual harassment as a business issue, according to a recent survey, though venture capital-backed and tech companies are discussing it more.
Some 77% of directors surveyed said their boards had not discussed and 83% had not reassessed company risk as a result of media reports of sexual harassment.
The survey, from Boardlist and Qualtrics, was taken in July, in the wake of summertime scandals that led to the ousting of Uber founder and CEO Travis Kalanick. It indicated that venture capital-backed and tech companies were turning more attention to the issue.
Of venture capital firm-associated board members, 83% said their boards had talked about the public accusations of sexual harassment and sexist behavior and nearly all (95%) were either implementing or re-evaluating plans on what to do if the same issue came up in their companies.
Other boards, however, weren’t has focused on the issue.
It’s been two months since Harvey Weinstein, Hollywood producer and co-founder of the Weinstein Company, was accused of sexual harassment and assault and was fired from his company. Dominoes continue to fall in the form of accusations against Lauer, Kevin Spacey and more, so directors from a broader range of companies may be beginning to take notice.
“The survey was taken in July,” points out Sukhinder Singh Cassidy, CEO and founder of Boardlist. “To be fair, the Harvey Weinstein story hadn’t happened yet.” But in light of the Uber problems and a flurry of venture capitalists who were also accused of sexual harassment, the spotlight was shining on tech.
Cassidy says she plans to take the survey again in six months, when she expects to see a change.
“It wasn’t a conversation then, but I’d be shocked in six months if we see it isn’t becoming one,” she says. “My hope is when sexual harassment is not just in tech, but politics, the media, entertainment, boards will start addressing company culture proactively.”