ATLANTA – Norfolk Southern confirmed late Sunday night that its board has opened an investigation into allegations of conduct by CEO Alan Shaw that is “inconsistent with the company’s Code of Ethics and company policy.”
The Wall Street Journal reported this afternoon that Shaw is expected to leave the company by the end of the week, citing people familiar with the matter. CNBC on Sunday afternoon first reported that the board was probing allegations that Shaw had an inappropriate workplace relationship, citing three unnamed people said to be familiar with the matter.
“Norfolk Southern holds all its team members to the highest standards. In line with the company’s Code of Conduct and company policy, allegations of misconduct are thoroughly investigated. The code also includes resources for employees to anonymously report concerns, including through the Ethics & Compliance Hotline,” the railroad said in a statement.
The board’s audit committee has hired a law firm to conduct the investigation. “To ensure a fair investigation, the company and the Board cannot comment further until the investigation is complete,” NS said.
Shaw, who became chief executive in 2022, maintained the backing of the NS board despite the fallout from the disastrous hazardous materials derailment in East Palestine, Ohio, in 2023, as well as during its proxy battle with activist investor Ancora Holdings this year.
If Shaw departs, it is unclear who might be named as an interim chief executive. Current board members with CEO experience include Claude Mongeau, who once led Canadian National; Richard Anderson, the former Delta Air Lines and Amtrak chief executive who was elected to the board this year; and Thomas Kelleher, who was chairman and CEO of Morgan Stanley Bank, N.A.
Note: Updated at 3:35 p.m. Central with references to Wall Street Journal report and potential interim CEO candidates.
If Shaw goes, then HELL NO to Richard “I couldn’t run Amtrak so how am I supposed to run a real railroad” Anderson. The ONLY board candidate who should be given a chance, if only an interim chance, is Mongeau if only because he knows what running a railroad involves. Everyone else will only try to make the OR look good and if that happens they might as well announce the impending split up of NS to the other US operators.
If Shaw was stupid enough to do this after all the earlier scrutiny then he deserves to be out on his head. If not, then LET THE MAN DO HIS JOB, FHS!
There’s an article in the Wall Street Journal this morning discussing the Shaw investigation and suggesting he will resign by the end of this week. As discussed by others here, it does sound like there’s some “Politics” behind the scene here (possbily) to get rid of Mr. Shaw.
He was certainly delt a bad hand coming in as CEO in 2022 and now he is getting shown the door (assuming there’s nothing to this alleged “Inappropriate relationship”…).
It’s hard not to feel bad for Mr. Shaw right now …….
“Innocent until proven guilty” doesn’t apply in corporate boardrooms.
While we always hear about “golden parachutes” and (often excessive) bonuses paid to C-suite executives, it can be a double-edged sword. Romantic involvement with a subordinate (if that is the case here) is close to the top of most companies’ “Thou Shalt Not” list. Unless the alleged relationship is totally fabricated, his credibility as a leader and decision-maker is shot for the simple fact that he put himself in such a position in the first place.
And if he is having an affair with a subordinate that’s ok in Charles’ world?
Didn’t say he did or didn’t. Didn’t say it’s okay or not. I said it’s too easy to get a conviction of “sexual harassment”, too hard to defend against.
The first job I had out of U-Michigan, we were mostly in our twenties, most of us single, everybody dated everybody, some guys went to bed with some of the women.
One man was a bit older, a manager. He married a subordinate. Nobody raised an eyebrow, it didn’t occur to any of us that they did anything wrong. I thought the world of both of them and was happy for them. All these years later I have no idea why anyone would object.
As they say about America’s new culture, “Nothing is allowed, anything goes.”
No, John, guilty until proven innocent. I’ve seen it happen. B/c sex harassment is an accusation with a built-in verdict of guilty, it’s used to get rid of people entirely innocent.
This guy can’t seem to catch a break.
Innocent until proven guilty.
If Shaw is found to be complicit, then action should be taken.
However, this coming after East Palestine, a big board fight, a proxy issue with a hedge firm and his outspoken desire to increase safety, which rubbed some Class 1’s the wrong way……also makes me very wary as to the motives. Some unsavory conduct was also present when vested interests didn’t get their way.
Politics, even in the corporate world can get pretty nasty when money (lots of it) are involved.
“Innocent until proven guilty”? You are obviously unfamiliar with the 21st century U.S. Today, it’s “Guilty. There is no innocence”.