Embattled Yahoo CEO Scott Thompson has left the company, Yahoo announced today, after more than a week of controversy over questions about embellishments to his resumé.
Ross Levinsohn, who is the company's head of global media, will serve as interim CEO while the board searches for a permanent replacement. Fred Amoroso has been named chairman of the board, Yahoo also announced. Those changes are effective immediately.
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Thompson was hired in early January and was the third CEO to be tapped in just a little over three years, and this latest incident is sure to continue the ongoing turmoil that Yahoo, a pioneer in the Web portal space, has endured.
Besides the executive shuffling, the company also struck a deal to end a proxy fight by activist shareholder Daniel Loeb, who leads the Third Point investment fund, which owns about 5.8 percent of Yahoo. Loeb was the one who brought the resume embellishment to light and notified the U.S. Securities and Exchange Commission of it, plunging the company into its latest controversy. Loeb and two of four other people that he had pushed the board to name as directors will be seated on the board. The other two are Michael J. Wolf and Harry Wilson. Former NBC chief Jeff Zucker, who was the fourth candidate proposed by Loeb, has been withdrawn as a board nominee.
Five current members of the board who were to leave their positions at the company's upcoming annual meeting will resign their posts as of Wednesday, the company said. Besides non-executive chairman Roy Bostock, whom Amoroso replaces, they are Patti Hart, VJ Joshi, Arthur Kern, and Gary Wilson.
Thompson's departure comes "after a poorly handled controversy," said Jeff Kagan, an independent technology analyst. "Yahoo has been struggling over recent years and this new incident only makes matters worse for the company." He predicted that "this CEO mess is going to leave Yahoo all tied up for at least several more quarters."
Thompson, who was previously an executive with eBay, was hired by Yahoo to try to get the struggling Internet company back on track after years of leadership changes in the midst of unsteady financial performance and competitive pressure from Google and more recently from Facebook. But then Loeb pushed his own slate of candidates -- himself included -- for the board of directors and as part of that revealed that Thompson did not have a college degree incomputer science, contrary to what was on his resumé and information in the company's financial filings.
Thompson sought to quell the situation by saying it was the fault of the head-hunting firm Heidrick and Struggles, which he said was responsible for the mistake when he was in the running to become president of eBay's PayPal unit in 2000. However, Heidrick and Struggles replied that it was "verifiably not true" that the firm was responsible for the mistake. The firm told Yahoo's board that it had a copy of the resumé Thompson submitted that included the computer science degree on it, according to published reports.
He also reportedly met with Yahoo employees in two meetings to try to clear up the matter and in a statement released by Yahoo he apologized that questions about his resumé had become a "distraction." However, those attempts were unsuccessful and the controversy continued.
