Norfolk Southern says investigating CEO over alleged misconduct

https://www.reuters.com/business/autos- ... 024-09-08/ (soft paywall)

Sept 8 (Reuters) - Norfolk Southern said late on Sunday it has opened an investigation into allegations of potential misconduct by Chief Executive Alan Shaw.

The company said that its audit committee is working with a law firm "to conduct an independent investigation of the allegations."

CNBC had first reported, citing people familiar with the matter, that Shaw engaged in an inappropriate workplace relationship.

Shaw did not immediately respond to a request for comment on the investigation.

In May, activist investor Ancora won three board seats at the railroad operator but failed to oust the railway's chief executive.

Ancora had proposed investors push Alan Shaw off the board and elect Jim Barber, a former chief operating officer at UPS, so that he could eventually replace Shaw as CEO. They also proposed Jamie Boychuk to become the chief operating officer.

Shaw joined the company in May 2022, replacing Jim Squires.

The hedge fund argued new blood was needed to improve financial and operational metrics and said it would continue to hold the company accountable for any future railway accidents or underperformance.

An inappropriate workplace relationship hardly seems to be an appropriate topic for here.

Why not? They fired him (well, they say he “stepped down”), which will absolutely affect the company’s performance.

Wall Street always wins, and the railroads (and the rest of us peons) always lose.

Jim

Erie-Lackawanna wrote: ↑Mon Sep 09, 2024 7:04 pm Why not? They fired him (well, they say he “stepped down”), which will absolutely affect the company’s performance.

Wall Street always wins, and the railroads (and the rest of us peons) always lose.

Jim

https://www.reuters.com/business/autos- ... 024-09-09/

Sept 9 (Reuters) - Norfolk Southern's CEO Alan Shaw is expected to step down from his role at the railroad company amid an investigation into allegations of potential workplace misconduct, two sources familiar with the matter told Reuters on Monday.

The company said on Sunday that it is reviewing allegations that Shaw violated its ethics policy.

Norfolk Southern did not immediately respond to Reuters' request for comment. Shaw could not be immediately reached for comment. The sources asked not to be identified to discuss sensitive personnel matters.

You have to remember, the CEO is responsible for everything at the company, and if something going wrong is "swept under the rug" by the CEO, the the CEO is complicit... and you have to replace them.

And I doubt anybody not working for NS knew his name until this "scandal" came out.

For years before Obergefell, all we heard was "you can't help who you love..." but this is considered a lapse of ethics like harassment or theft? As long as there's no favoritism, who Shaw was schtupping really has no business being made into a corporate investigation.

What's ironic is Shaw didn't like PSR.

The activists wanted him gone two years ago, and just like we saw two months ago in DC, once a palace coup starts, all you need is a good story for the justification.



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eolesen wrote: ↑Tue Sep 10, 2024 9:13 am And I doubt anybody not working for NS knew his name until this "scandal" came out.

For years before Obergefell, all we heard was "you can't help who you love..." but this is considered a lapse of ethics like harassment or theft? As long as there's no favoritism, who Shaw was schtupping really has no business being made into a corporate investigation.

What's ironic is Shaw didn't like PSR.

The activists wanted him gone two years ago, and just like we saw two months ago in DC, once a palace coup starts, all you need is a good story for the justification.



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Knew his name or remembered it? Because as you may remember NS had a derailment in a place called E. Palestine last year which was kind of a big deal. Which at this point I would go as far as to say that social media and the news outlets blew the extent of the disaster way out of proportion. After that he was absolutely dragged by almost every media source and had to testify to congress. Plus you had the tons of clickbait social media posts which were shared far and wide, with little to no factual basis. So the likely hood that someone outside NS and the railroad/railfan community, knew who he was is pretty good. I don't use Reddit, but this is a good example of what I am talking about: https://www.reddit.com/r/facepalm/comme ... ?rdt=34885
At one point during the backlash around the derailment, I think he ended up getting doxxed as well as had death threats against him, as the uneducated would read one social media post and associated him as the only cause of the disaster.

OK, few people "remember" who he was.

Doesn't change much in my argument, though.

As long as it accomplished the removal that the PSR advocates and activist investors wanted, the ends justifies the means.

Most organizations ban sexual relationships between a supervisor and employees below them in the management hierarchy for good reason, and I understand NS is one of those organizations (I'm not an employee, so I can only see the high level HR guidance, but not the actual policy). If the CEO violated HR policies at NS designed to ensure NS runs well then good riddance to him.

I am a long term shareholder of NS, and voted against the activists at the last stockholder's meeting, but am not willing to dismiss Shaw's actions.

His name is Alan Shaw Norfolk Southern CEO. He violated Norfolk Southern company policy and therefore terminated.

There is no conspiracy here.

Everyone who has had any contact with anything company
related during his tenure knows his name, who he is, and his position is in the company.
It does belong on this forum.

CEO Alan Shaw fired for cause, along with Chief Legal Officer Nabanlta Nag, for "engaging in a consensual relationship."

Norfolk Southern CEO Alan Shaw was fired for cause by the railroad’s board for “engaging in a consensual relationship with the company’s chief legal officer,” who was also terminated, the railroad announced Wednesday evening.

A statement from the company on Wednesday said that Shaw had been dismissed “for cause,” which could prevent him from collecting the kind of exit package that CEOs often receive when shown the door...

... It announced it had picked CFO Mark George as the company’s new CEO.

I suspect they'll negotiate settlements for both to leave. Simply cutting both loose without any compensation, even for cause, typically invalidates non-compete agreements that would prevent a competitor or supplier/customer from hiring them.

Without a non-compete, regardless of how he leaves NS there are competitors and customers or suppliers who do a lot of business with that company and could benefit from knowing future strategy and other issues which would have been discussed at both of their levels.

Believe me, they had to sign Non Disclosure Agreements. This is 2024. Wake up!
WE WILL NEVER KNOW.
And it's none of our business!

Non-disclosures aren't the problem. The lack of a non-competes is.

American Airlines fired Scott Kirby, and didn't have non-competes in place. United Airlines hired him before the day was out. I'm sure Scott had non-disclosures, but how is American ever going to know what he tells anyone at United about what American's plans were?

American Airlines laid off most of their sales staff two years ago, and still didn't have non-competes in place. Delta and United hired a bunch of them in key markets. Sales people tend to take customers with them. A non-disclosure becomes meaningless if a customer is lured away.

Today, American Airlines is financially nowhere near as healthy as United and Delta, who are taking market share away from American left and right.

I'm sure that CSX would love to get Shaw into a conference room for a couple weeks. What happened with the chief counsel would be none of their concern.

I think a Journal report will not result in this forum becoming Playboy dot com.

Also of interest and in good taste.

Fair Use quotations intentionally omitted.