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Yahoo CEO Scott Thompson made news again May 11, reportedly telling colleagues that a nationally known and respected executive placement firm edited an error into his resume that has been there for years and is now causing him and his company consternation.
Thompson, who didn’t earn the computer science degree in 1979 his resume claims, was called out May 3 by Yahoo stockholder Daniel Loeb for the discrepancy but has ignored requests to resign, as has been demanded by Loeb and at least one other powerful stockholder.
Yahoo, which acknowledged the mistake on Thompson’s resume on May 3, used the resume in a regulatory filing with the Securities and Exchange Commission and has called the misinformation an “inadvertent error.”
Thompson, as reported by Business Insider, Reuters and other news sources, isn’t naming names about who’s to blame, but the search firm has been identified as Chicago-based Heidrick & Struggles.
According to the reports, Thompson is telling Yahoo employees that a recruiter interviewed him and put the false information in a document and passed it to eBay when he applied to work there years ago. After eBay hired him, it used the document to write his public bio, he apparently has said.
Thompson, however, reportedly accepts blame for not checking up on H&S’s bio. Email queries from eWEEK to Heidrick & Struggles were not answered by end of business May 11.
Meanwhile, Yahoo’s board of directors has formed a special committee to conduct a thorough review of Thompson’s academic credentials, “as well as the facts and circumstances related to the review and disclosure of those credentials in connection with Thompson’s appointment as CEO,” the company said in a statement to the media.
The special committee will be chaired by Alfred Amoroso, an independent director who joined the board in February. The other members of the special committee are John Hayes and Thomas McInerney, independent directors who joined the board in April of this year.
His Program of Study Was in Accounting
Hedge fund director Loeb, whose firm, Third Point, owns 5.8 percent of the company, did the original research, revealing May 3 that Thompson actually earned a degree in accounting at Stonehill College in Massachusetts.
“If Mr. Thompson embellished his academic credentials, we think that it 1) undermines his credibility as a technology expert, and 2) reflects poorly on the character of the CEO who has been tasked with leading Yahoo at this critical juncture,” Loeb wrote in his May 3 letter to Yahoo’s board. “Now more than ever, Yahoo investors need a trustworthy CEO.”
Another vocal stockholder, Eric Jackson of Ironfire Capital–which owns about 3.2 million Yahoo shares–joined Loeb a few days later in demanding that Thompson resign.
Jackson, a vocal opponent of Yahoo’s decision to reject a Microsoft buyout in 2008, told the San Jose Mercury News May 4: “Thompson’s got to go. Putting shareholders aside, I don’t know how any engineer at Yahoo could listen to that guy from now on and not think in the back of their mind, ‘Why in the heck would you make up that you studied computer science?’ It’s going to be completely distracting. Maybe he can reconstruct his reputation somewhere else.”
Yahoo Defends Its Leader
While admitting the resume error, Yahoo defended its new CEO, who took over in January.
“It in no way alters that fact that Mr. Thompson is a highly qualified executive with a successful track record leading large consumer technology companies,” Yahoo said in response to Loeb’s May 3 letter.
But Loeb, in his subsequent response to Yahoo on May 4, described Yahoo’s statement as insulting to shareholders.
“This, in our view, is the height of arrogance. Mr. Thompson and the board should make no mistake: This is a big deal. CEOs have been terminated for less at other companies,” Loeb said in a letter to Yahoo’s board.
Chris Preimesberger is Editor of Features and Analysis at eWEEK. Twitter: @editingwhiz