A CEO’s canoodling along with his corporate’s human sources leader – stuck at the “kiss cam” at a Coldplay live performance – made international headlines this summer season. Past the memes and tabloid fodder, non-public lives have been shattered and an organization was once left in turmoil after its chief’s unexpected go out.
The case, involving the AI company Astronomer, is also probably the most visual of new CEO non-public scandals – assume intercourse affairs, drug abuse or embarrassing conduct – however it’s now not an remoted incident. Simply weeks following the Coldplay “kiss cam,” the CEO of Nestlé was once proven the door for an identical conduct involving a courting with a subordinate. Private scandals were the highest explanation for CEO terminations in recent times.
How do those scandals stack as much as different company indiscretions, comparable to monetary fraud? As a control professor, I knew that there’s quite a lot of analysis on CEOs’ monetary crimes, however strangely little on non-public misdeeds.
So my colleagues and I tested just about 400 CEO scandals involving both monetary or non-public misconduct. On this analysis, printed in August 2025 within the magazine Strategic Group, we discovered that now not all CEO scandals are handled similarly: The sort makes all of the distinction.
The Coldplay incident turned into the topic of ridicule at public occasions for days, comparable to at this July 18, 2025, Main League Three-hitter.
Isaiah Vazquez/Getty Photographs
Private scandals are tougher to live on
For most of the people, non-public indiscretions – comparable to having an extramarital affair or abusing medicine – are a non-public topic. However for CEOs, even scandals unrelated to trade create doubt about their judgment, integrity and management. The result’s typically career-ending for the CEO, analysis displays, and will create lasting hurt for the corporate.
We discovered that CEOs overwhelmingly go out within the wake of private scandals – 5 occasions as continuously as CEOs who dedicate monetary misconduct do, in reality. And robust trade efficiency doesn’t have a tendency to provide coverage.
For instance, Hewlett-Packard’s Mark Hurd, who’s broadly credited with turning round HP within the mid-2000s, was once ousted following an excessively visual non-public misconduct scandal 15 years in the past. The fallout was once swift: The corporate’s inventory fell just about 10% right away after the announcement, and with management in a tailspin, it dropped greater than 40% inside of a 12 months.
Why unhealthy numbers include higher odds
Firms also are robotically accused of “cooking the books.” In contemporary months, a number of companies were pressured to restate their income after their monetary statements didn’t upload up. Those scandals shake investor believe, cause sharp drops in corporate inventory and continuously result in the manager monetary officer’s departure – with some CEOs following go well with.
Then again, whilst cooking the books is regarded as a serious type of company misconduct, our analysis means that it has fewer job-ending repercussions for CEOs than non-public scandals do. More or less part of all CEOs implicated in monetary scandals live on, we discovered – as a result of, not like in non-public scandals, CEOs can continuously shift blame.
We additionally discovered that CEOs brushed aside because of monetary scandals have a tendency to be changed with out of doors applicants, which has been proven to stabilize an organization’s inventory value and result in more potent long-term efficiency.
It could be unexpected to be told {that a} CEO’s non-public misconduct can come at a better price – each to the trade and the chief – than outright monetary fraud. Is company The us overestimating the significance of CEOs’ non-public conduct? Or is it underestimating the significance of cooking the books?
Whilst I don’t have solutions to those questions, I believe our findings display the will for extra dialogue – and extra analysis.
