It’s unclear what corporate scandals will look like in 2019, but in 2018 companies put in procedures to try to stop, or at least mitigate, the financial pain.
For many, this means efforts to diversify the boardroom.
“I do believe part of the problem is that a lot of these organizations have been primarily men, so if there was sexual harassment, it was really difficult to report it,” said Patricia Lenkov, founder of board recruiting firm, Agility Executive Search.
Boards are also creating more oversight at the highest levels, creating new reporting methods, should the questionable behavior be carried out by CEOs or in human resources departments. Some boards, meantime, are also asking to be informed more frequently about complaints.
The oversight is for more than public relations. #MeToo fallout has also led to litigation this year.
A CBS shareholder in August sued the media company, roughly a month after shares of the company fell a little more than 6 percent when news leaked of a pending article alleging sexual misconduct by then CEO Les Moonves. The company had touted its “harassment-free workplace environment” in filings with the Securities and Exchange Commission, but did not disclose Moonves’ alleged misconduct, the suit stated.
Moonves, like Steve Wynn, was denied severance.
“Now the [#MeToo] risk can be on par, at least reputationally, with corruption risk and cyber-security risks,” Casazza said.
Roughly 55 percent of professional women are less likely to apply for a job at a company facing public allegations of #MeToo improprieties, according to advisory firm advisory firm FTI Consulting. The firm also reports that nearly half of professional women are less likely to buy products or stock from such companies.
“It may take a few years, but [the survey] foreshadows significant impact for a company,” said Elizabeth Alexander, senior managing director at FTI Consulting.
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