"There is a crack, a crack in everything. That's how the light gets in."
- "Anthem," by Leonard Cohen
How outrageous does executive behavior have to be before it should be deemed unacceptable by corporate America? Are we experiencing a trend toward greater scrutiny of our executives' personal lives and is this a good idea? What should be the peccadillo standard for the executive officers of public companies?
Witness the recent forced resignation of David Colby, chief financial officer and vice chairman of the board of WellPoint Inc. Colby was a crackerjack numbers guy who had been voted the industry's best financial officer four years in a row.
Newly elected CEO Angela Braly and outgoing CEO Larry Glasscock bounced Colby, citing violations of the company's code of conduct. Little information was provided except to say the violation of the code was unrelated to WellPoint business.
Not everyone agrees. An ex-employee of WellPoint, Sarah Waugh, named WellPoint in a suit charging Colby with sexual battery. A textbook approach would have been to bare all the facts, let the public have its day, and move on. As Randy Tobias says, "Put the Moose on the Table." Nonetheless, I salute the Glasscock and Braly efforts to preserve privacy and dignity for Colby.
Only later did the tangled mess of Colby's life come to light in publications, including this one, The Wall Street Journal and The Los Angeles Times. The Times detailed a number of his liaisons alleged by Waugh to be more than 14 since 2004. It's a wonder Colby doesn't have a professional scheduler in his employ. (Wilt Chamberlain would have scoffed at Colby's low score.) In light of these disclosures, one does not have to read too much of the WellPoint Standards of Ethical Business Conduct to conclude that sufficient grounds existed to request Colby's resignation.
Philandering has sparked a whole new industry. If you are thinking of cheating on your spouse, you can email Alibi Network to cover your tracks. As its advertising says, "If you're in a situation where you have to stray, why not get away with it?" For "attached adults involved in discreet relationships," this company will invent, create and provide customized alibis, excuses and all related cover-up essentials for a fee of up to $1,500 per tryst.
Certainly, dalliances at the office should come under scrutiny and should qualify as violations of corporate standards of ethical business conduct. Suppose, however, that an executive engaged in just one extramarital affair not relating to business, or maybe two or three. Is this a matter for the board, or is this nobody's business?
One might argue that extramarital affairs constitute unethical behavior and that marital infidelity is strong evidence of a propensity for unethical business behavior. On the other hand, if we were to oust every male executive who lost his way down the perfume path, somewhere between 24 percent and 68 percent would lose their jobs, according to various studies, many nonscientific. Women would fare only slightly better. In addition, we would be holding numerous interim elections for president of the United States.
Colby is not the first high-profile executive to be brought down by irrational behavior outside the office. Last month, Time Warner Inc. fired Home Box Office Inc. Chairman and CEO Chris Albrecht after a public argument with his girlfriend outside the MGM Grand Casino in Las Vegas. Sexual frolics figured in the resignation of U.S. Rep. Robert Livingston, R-La., and in the criminal trials of Tyco's Dennis Kozlowski, World-Com's Bernie Ebbers and Enron Corp.'s Jeff Skilling.
We are no longer in the Kennedy era when leaders jumped from bed to bed and nobody cared about the dirty linen. In these days of Sarbanes-Oxley subjecting businesses to greater scrutiny, have we let our oversight function grow to abusive proportions? Perhaps we should consider giving our executives back their personal lives, sordid as they may be.
Maurer is a shareholder in IBJ Media Corp., which owns Indianapolis Business Journal. To comment on this column, send e-mail to email@example.com go to IBJ Forum at www.ibj.com.