The #MeToo movement has significantly raised awareness and public discussion about sexual harassment and assault in all areas of life – including the workplace. There have been similar periods of heightened awareness and discussion in the past, resulting in marginal changes. But one of the biggest differences about the #MeToo movement so far is that it has brought down some of the richest and most powerful men in the worlds of entertainment and business.
A recent news report from National Public Radio cites a study from auditing firm PwC. The study revealed that in 2018, personal misconduct was the leading cause of CEO firing at the highest-profile public companies. This is unprecedented, and seems to indicate that sexual harassment is finally being recognized and punished among the leadership of major companies.
The study examined turnover among CEOs at 2,500 of the world’s largest publicly traded companies. In 2018, there were 89 CEO departures in these companies. Of these, 39 percent had to leave due to allegations of unethical behavior, including
- Sexual harassment and misconduct
- Fraud
- Bribery
- Insider trading
Historically, CEOs were ousted primarily (and sometimes only) for poor financial performance. But last year was the first time in the nearly two decades of tracking such metrics that bad behavior and personal misconduct were more prevalent reasons for firing than a company’s financial bottom line. By comparison, poor financial performance was the main factor in only 35 percent of firings in 2018.
Ultimately, the significant amount of turnover at these companies sends a powerful message that such behavior can/will no longer be tolerated – even by those at the top. But it is also a reminder to average employees that taking a harassment or discrimination complaint up the chain of command isn’t always effective or safe for victims. If company leadership engages in or tolerates the same behavior, the victim may be worse off for reporting internally than they would be if they kept silent.
