Yahoo! board! probes! CEO's! CompSci! CV! blunder!
Thompson's bio and SEC doc gaffe spirals
By Brid-Aine Parnell • In Business • At 10:42 GMT 4th May 2012
Yahoo! has decided to take the revelation that its CEO Scott Thompson padded his CV a tad more seriously, The Register understands, promising that the board would look into the situation.
The web firm's initial response to accusations yesterday from activist investor Third Point that Thompson did not in fact possess a degree in computer science was somewhat casual, claiming that the whole thing was an "inadvertent error".
However, later in the day the company promised that its board would be reviewing the matter and would make an appropriate disclosure to shareholders after the review.
The revelations first came via a letter filed with the Securities and Exchange Commission (SEC) from investment fund Third Point, a major shareholder in Yahoo! and a vociferously vocal agitator for change at the company.
Some filings with the SEC along with the company's website asserted that Thompson held "a degree in accounting and computer science", but others only laid claim to the accounting degree.
When Third Point noticed this, it went to his college and discovered that Thompson was an accountant, but had no computer science degree. In fact, Stonehill College didn't even start offering a computer science degree until four years after he graduated, so he couldn't even have sat in on a few courses.
And Thompson wasn't the only one with two versions of an education. Third Point also alleged that Patti Hart, the head of the search committee that appointed him CEO, was down in various corporate filings as holding a bachelor's degree in marketing and economics from Illinois State University, but her degree was actually in business administration.
"Third Point believes Mr Thompson and Ms Hart owe Yahoo!, its board of directors and its shareholders an explanation," the fund said.
"We also call upon the board to immediately commission an independent investigation to determine whether these individuals (i) made misrepresentations to the Yahoo! board and the investing public or (ii) have violated the company’s code of ethics.
"Unless there are satisfactory explanations for these apparent discrepancies, the board will need to decide whether these two individuals should remain at the helm of Yahoo!"
Initially, Yahoo! responded that Thompson's education record was a simple mistake.
"Scott Thompson received a bachelor of science degree in business administration with a major in accounting from Stonehill college," Yahoo! said. "There was an inadvertent error that stated Mr Thompson also holds a degree in computer science. 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."
Although the web firm is now taking the issue more seriously, it might not be enough to silence critics. The fact that the mistake claimed a technological background where there was none is likely to engender a serious lack of confidence as it looks less like an innocent error than, say, claiming an economics degree instead of an accounting degree.
Also, since the claims were made in official filings with the SEC, it may see the need to launch its own investigation, since mistaken information given to the market regulator doesn't look good, whether it was inadvertent or not. ®