Avoid the pitfalls of removing the boss

Posted by Nicola Diggle on
Removing senior directors goes against the grain in business. Extracting the leader certainly deviates from the norm but can be performed as and when necessary. However, there are many pitfalls that would need to be avoided should this sensitive and intricate issue arise.  

The often perplexing matter needs to be carefully studied with an abundance of legal considerations that should be taken into account.

The problem is big decisions usually come from the top but there have been recent examples where the most senior figure in a company has been deposed. Like Harvey Weinstein, who was ousted from the board of Miramax, the independent film company he co-founded, in October 2017 in light of allegations. Earlier that year in June, Uber supremo Travis Kalanick resigned from his position as chief executive following criticism of an unethical culture at the company.

Internal investigations of impropriety can bring about the downfall of those at the summit as the company and shareholders wish to avoid unwelcome controversy. However, bosses do sometimes return as Steve Jobs did at Apple. He was removed in 1985 because of a power struggle with John Sculley but made his comeback in 1997 as he was reinstated. 

Shareholder issues need to be considered as do all potential legal matters involved in removing directors to avoid becoming lost in the morass of firing the boss. This is where our expertise can help you negotiate the minefield.

About the Author

Photograph of Nicola Diggle

Nicola is a Senior Associate in our Litigation and Dispute Resolution Division specialising in commercial litigation and dispute resolution. She has a great deal of experience acting for individuals and corporates.

Nicola Diggle
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