Intel CEO Brian Krzanich Resigns After Violating Company Policy -- 3rd Update
June 21 2018 - 11:31AM
Dow Jones News
By Austen Hufford and Aisha Al-Muslim
Intel Corp. Chief Executive Brian Krzanich resigned Thursday
after the company determined he violated company policy during a
past, consensual relationship with an Intel employee.
The company said that a continuing investigation by internal and
external counsel confirmed a violation of Intel's
non-fraternization policy, which applies to all managers.
Intel said it accepted Mr. Krzanich's resignation as it expects
all employees to respect Intel's values and adhere to its code of
conduct. Mr. Krzanich couldn't be reached for comment.
The board said Chief Financial Officer Robert Swan would become
interim CEO effective immediately. Mr. Swan joined Intel in 2016
after being CFO of eBay Inc. Intel has started a search for a
permanent leader and is considering internal and external
candidates.
The company also released a financial forecast that was above
analyst expectations. For its second quarter, the company expected
adjusted earnings of 99 cents a share and revenue of $16.9 billion.
Analysts polled by FactSet had expected adjusted earnings of 86
cents a share and revenue of $16.3 billion.
Intel's shares fell 1.5% to $52.67 in morning trading.
While details of the relationship weren't disclosed Thursday,
the public resignation highlights the discussions happening in
workplaces around the country over how employers should regulate
office romances.
Intel has a longstanding, non-fraternization policy that
prohibits managers from having sexual or romantic relationships
with employees who report directly or indirectly to them, a
spokesman for the company said. The spokesman called the policy a
"strict" and "hard ban" that he said applies to all managers
regardless of seniority level. The policy also requires that
employees who see or believe someone acted inappropriately to raise
their concerns immediately, he said.
Dating policies at U.S. companies vary. Some employers don't
allow senior managers to have relationships with co-workers, even
if they are not direct reports. The idea is that even if a manager
doesn't directly oversee an employee, they may have more power
within the organization. Other companies have no issue with
consensual relationships but have asked for them to be disclosed.
Still others have no dating policy at all.
Some companies have been revamping their rules around workplace
relationships in the wake of the #MeToo movement.
Mr. Krzanich joins other CEOs who left following allegations of
relationships with employees, including Harry Stonecipher, who left
as CEO of Boeing Co. in 2005; Steven Heyer, who left Starwood
Hotels & Resorts Worldwide Inc. in 2007; and Christopher
Kubasik, who was the CEO-in-waiting when he left Lockheed Martin in
2012.
Mr. Krzanich started at Intel in 1982, rising through a series
of technical and leadership roles to become chief executive in
2013. In recent months, Mr. Krzanich has emerged as a leading
proponent of the commercial drone industry, primarily by publicly
championing the company's technology and serving as chairman of a
high-level federal aviation advisory committee.
Intel, like many other technology companies, has said it was
working to increase gender and racial diversity in its workplace.
In its 2017 diversity report, the company said 73.5% of its total
workforce was male.
--Andy Pasztor contributed to this article.
Write to Austen Hufford at austen.hufford@wsj.com and Aisha
Al-Muslim at aisha.al-muslim@wsj.com
(END) Dow Jones Newswires
June 21, 2018 11:16 ET (15:16 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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