Shortly after McDonald’s CEO Steve Easterbrook announced he was leaving the company because of an “inappropriate” relationship with an employee, the company has announced that Chief People Officer David Fairhurst will be leaving, too, reports the Wall Street Journal.
Readers may remember that we profiled Fairhurst in a cover story earlier this year. Fairhurst worked closely with Easterbrook when the latter was president of McDonald’s U.K. operations and the former served as CPO there. Fairhurst became the corporation’s CPO shortly after Easterbrook became CEO. Chris Kempczinski, McDonald’s former head of U.S. operations, will succeed Easterbrook as CEO. Fairhurst has been replaced by Mason Smoot, senior vice president for strategic alignment and chief of staff for the Office of the CEO, who will serve on an interim basis, the company said. A 23-year veteran of the company, Smoot has also served as vice president of HR for McDonald’s USA.
“David was a good leader who helped us set the direction for People at one of the largest companies in the world,” said Derek Berube, McDonald’s director of global people insight, via email. “He will be missed, but we are in a good place to keep driving our people strategy at McDonald’s.”
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As reported in the story, Fairhurst had high praise for Easterbrook: “I have the privilege of working with a CEO who’s really a catalyst of change and knows how to harness all the ‘capitals’: financial, cultural and human,” he said.
Easterbrook was widely credited with turning things around at McDonald’s, where sales had risen after he became CEO (although customer traffic remained relatively flat and franchisees complained about increased costs). Fairhurst credited Easterbrook with leading a cultural change at the fast-food giant.
“Our heritage was about understanding our customer, but the challenge was that our customers’ needs had moved on, and we hadn’t kept up as well as we should have,” Fairhurst told me. “We needed to reconnect with our entrepreneurial heritage but in a contemporary way, and this required an evolution of our culture.”
Like many CEOs, Easterbrook won’t be walking away empty handed: In addition to six months of severance pay from McDonald’s, he’ll also keep stock awards vesting within three years of his firing (forfeiting later awards) and will be eligible for a prorated bonus for the current fiscal year determined by the company’s performance, the WSJ reports. Easterbrook received $15.9 million in total compensation last year.
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CEO resignations due to inappropriate relationships with employees are nothing new. Former Hewlett-Packard CEO Mark Hurd was fired in 2010 due to what the company said was an inappropriate relationship with an HP contractor (Hurd, who later became co-CEO at Oracle Corp., died late last month at the age of 62 due to an illness).
Relationships between managers and employees and among colleagues are certainly nothing new, of course. A survey of 2,446 participants by Reboot Digital Marketing finds that, although 46% of employers would prefer that their staff not date each other, 22% of employees admit to a fling with their manager or boss.
Some additional findings from the survey:
- 41% of first kisses between colleagues take place at work/ work event
- 36% of office flings have involved a married partner
- 22% of employees admit to a fling with their manager or boss
- 57% have kept their dating on the down-low
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