Investor says Yahoo CEO lied about degree
A disgruntled Yahoo shareholder has questioned the integrity of recently hired CEO Scott Thompson after exposing a misrepresentation about the executive's education.
The fabrication, confirmed on Thursday by Yahoo, gives New York hedge fund manager Daniel Loeb more artillery as he tries to topple a board of directors favoured by Thompson, who became CEO of the troubled internet company four months ago.
Loeb, whose fund Third Point owns a 5.8 per cent stake in Yahoo, gained more leverage when he discovered Thompson does not have a bachelor's degree in computer science, as Yahoo stated in a regulatory filing last week.
Thompson has an accounting degree from Stonehill College, an accomplishment that Yahoo also listed in the filing. The accounting degree was the only one listed in Thompson's resume last year by eBay, when he was still running that company's PayPal payment service. He graduated in 1979, according to Stonehill's website.
Yahoo confirmed Thompson's credentials had been exaggerated in the recent filing with the Securities and Exchange Commission. The company brushed off the distortion as an "inadvertent error."
But Loeb pounced on the misinformation as a violation of Yahoo's code of ethics and called for an independent investigation to determine whether Thompson had misled the company's board about his technology credentials. He also cited the mix-up as an example of Yahoo's poor corporate governance.
"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 a letter to Yahoo's board on Thursday. "Now more than ever Yahoo investors need a trustworthy CEO."
The company stood behind Thompson in its statement. "This 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. "Under Mr Thompson's leadership, Yahoo is moving forward to grow the company and drive shareholder value."
Tensions between Loeb and Thompson have escalated since late March when Yahoo appointed three new directors to its board. In doing so, Yahoo snubbed Loeb, who had been lobbying for a board seat along with three allies who he believes have the skills necessary to help Yahoo rebound from its long-running struggles. At the time, Thompson made it clear that he and the Yahoo committee overseeing the search for new directors had concluded Loeb wasn't the best candidate.
Loeb is waging a campaign to persuade Yahoo's shareholders to elect him and his allies to the board at the company's annual meeting. The date of that meeting still hasn't been set.