Conducting a post-mortem of the CEOs terminated from their positions this year.
As 2022 draws to a close, it is time to sit back and reflect on events that have unfolded this year—the good, the bad and the ugly. We saw massive layoffs in the tech space and a devastating crypto market crash with one crypto company going down after another. You must have seen article after article talking about the situation with Luna and Celsius as well as the recent bankruptcy filings of FTX and BlockFi.
Naturally, when such situations occur, the person handling the overall operations of a company, that is, the chief executive officer (CEO), ends up under scrutiny. If you want to learn more about CEOs who landed their companies in trouble, you have come to the right place! Here is our round-up:
Sam Bankman-Fried
Bankman-Fried started his career with a stint in the finance world, working as a trader in the American capital market company Jane Street Capital in 2014. He then went on to get involved in trading cryptocurrency in 2017— buying Bitcoin in the U.S. and selling it in Japan for a profit, and by the end of the year, he founded the crypto trading firm Alameda Research. By 2019, he took an even bigger step into the crypto market opening up the Bahamas-based crypto exchange FTX. The company thrived throughout the pandemic and was able to become the second-largest crypto exchange in the world.
Come November 2022, things took a turn for the worse as FTX had to file for bankruptcy because Bankman-Fried decided to use the money that customers had deposited into it to save his first crypto business, Alameda Research. Soon after filing for bankruptcy, Bankman-Fried stepped down as CEO and apologized for his irrational decisions. Even as he showed remorse for the losses incurred by FTX’s customers, he continues to believe that things could have turned out differently had a buyer’s interest in funding FTX come eight minutes earlier.
Bob Chapek
Bob Chapek began working with Walt Disney in 1993. He moved across various departments in the company, from leading Disney’s home entertainment business in 2009 to becoming the president of consumer products in 2011 and then becoming the chairman of Walt Disney Parks and Resorts in 2015. He became the seventh CEO of Disney in 2020 after Bob Iger was dismissed. The company had been facing trouble during the pandemic as its Hong Kong and Shanghai parks shut down and it feared the failure of its live-action movie Mulan because theaters in China were not operational.
During Chapek’s leadership, the company was massively reorganized. The new Media and Entertainment Distribution group was made responsible for the monetization of all content and overseeing the company’s streaming services. A lot of higher-ups in Disney didn’t appreciate this decision because this made them no longer capable of controlling their departmental budgets. By November this year, Chapek was ousted from his position and the former CEO was reinstated. One of the key factors that led to this was the loss of confidence in Chapek from both Wall Street and senior Disney executives. The company had lost US$1.5 billion because of its streaming division, which Chapek had been trying to expand. Disney’s board of directors was especially concerned about Chapek’s response to the losses, which was to conduct layoffs to cut costs. It was this response that finally pushed them over the edge and convinced them to fire Chapek.
Akram Boutros
Dr. Arkam Boutros started his career in healthcare administration as an associate medical director for the New York-based Winthrop-University Hospital Center in 1992 and worked in executive positions at many different hospitals before joining The Metro Health System as the President and CEO in 2013. Under his leadership, Metro Health opened two hospitals, three emergency departments, 10 community health centers and nine pharmacies. He had also successfully taken the hospital’s revenue from US$785 million to over US$1.5 billion.
In 2021, after eight years of leading Metro Health, Boutros announced his plans to step down on December 31, 2022. But before he could retire, he was fired from his position as CEO by the hospital’s board of directors. Turns out, Boutros was conducting self-assessments and allocating himself bonuses, which hadn’t been authorized by the board. He paid himself a generous sum of US$1.9 million in bonuses between 2017 and 2022. Upon finding out about the bonuses, the board demanded repayment, and on October 31, Boutros paid back the company over US$2 million and another US$124,000 to the company as interest on the bonuses he had taken. Since being fired, Boutros has filed a lawsuit against Metro Health, claiming that his termination is a form of retaliation for exposing the board’s misconduct.
From making poor financial decisions to siphoning off company money, these CEOs have been fired for different reasons. But what remains common between all of them is that they all started off with good intentions and were successfully performing their respective roles before things turned sour. Hopefully, these stories help future CEOs learn a little bit more about the path that is ahead of them, informing them of mistakes they must avoid to successfully complete their tenures.
Also read:
- Navigating Tough Seasons as a CEO: A Look at Google, Apple and More
- How Do You Decide Which Co-founder Should Be CEO?
- 9 Signs It Is Time for You to Step Down as CEO
- 3 Shocking CEO Departures in 2020
Header image courtesy of Evanto.
