Yahoo facing shareholder showdown over CEO's fate
SAN FRANCISCO (AP) — Yahoo is facing a showdown with a major shareholder who wants the troubled Internet company to fire CEO Scott Thompson for unethical conduct.
The shareholder, activist hedge fund manager Daniel Loeb, told Yahoo's board of directors last week that he might take legal action if Thompson isn't ousted by noon ET Monday.
Loeb contends Yahoo needs to get rid of Thompson because he allowed an inaccuracy about his academic credentials appear in a regulatory filing, as well on the company's website for investors. Thompson's biography claimed he had a bachelor's degree in computer science as well as accounting from Stonehill College near Boston.
After Loeb raised questions about Thompson's education, Yahoo acknowledged that he never got the computer science degree. That distortion violated Yahoo's own code of ethics, Loeb said.
Yahoo initially brushed off the exaggeration as an "inadvertent error," before announcing the board would look into how the inaccuracy happened. The company hasn't set its own deadline for completing the investigation.
Experts in corporate ethics and governance believe Yahoo has to get rid of Thompson to preserve its own credibility. If Thompson is dumped, it will be Yahoo's second CEO firing in eight months.
Loeb controls a 5.8 percent stake in Yahoo through his hedge fund, Third Point LLC. He is trying to win four seats on Yahoo's board, including on for himself.