On Friday, Thiam announced that he would step down as CEO and vehemently claimed, “I had no ... [+]
We usually don’t associate corporate espionage, car chases, physical altercations and a suicide with the staid conservative world of Swiss banking. Credit Suisse, the Swiss-based banking giant, broke this stereotype as its chief executive officer, Tidjane Thiam was pushed out of the company after two alleged incidents of spying on former top-level executives.
Thiam—the first black CEO of a major European bank—resigned after he lost the confidence of the bank’s board of directors in the wake of a scandal in which private investigators, hired by Credit Suisse, spied on two former senior-level executives. It was announced by the bank on Friday that the board accepted Thiam’s resignation. Thomas Gottstein, a top executive in Switzerland, will take over the CEO role.
Leading up to the ouster, Thiam and Credit Suisse chairman Urs Rohner had reportedly been at odds over the accusations of espionage. The first reported incident was that of Iqbal Khan, the former head of the bank’s lucrative and highly successful wealth management unit. Khan was said to have bristled under Thiam’s management and told others that he was not shown the appreciation that he deserved. There was talk of Khan potentially taking over the CEO position.
It's been reported that Thiam and Khan were on bad terms. Khan, in addition to being a successful banker, was neighbors with Thiam. The animosity and tensions steadily grew between the two men and was amplified when Thiam complained about annoying renovations taking place at Khan’s home. Thiam spitefully planted trees on his grounds, which blocked Khan’s view of Lake Zurich. The situation escalated when the two met at a party and needed to be separated to avoid a physical altercation.
Ultimately, Khan decided to pursue other employment options and joined Credit Suisse’s cross-town rival, UBS. While on garden leave, he was followed by investigators hired by Credit Suisse. Thiam denied any knowledge of this happening. His protests appeared weak when the former head of human resources, Peter Goerke, similarly claimed to have been followed as well.
It was alleged by Khan that men employed by a private security company drove after him and his wife through the streets of Zurich. Khan and his wife confronted the stalkers and reported the matter to Credit Suisse.
It was determined that the investigators were hired by Thiam’s close-knit ally, COO Pierre-Olivier Bouée. An investigation conducted by an external law firm cleared Thiam of involvement in the Khan spying episode, but also ended with the firing of Bouée. Sadly, in a tragic turn of events, a private investigator—who allegedly helped Bouée with the espionage plan—killed himself.
Thiam and Bouée were colleagues for roughly 20 years. They’ve worked closely together for nearly two decades at the preeminent management consulting firm McKinsey in Paris. Then, Bouée followed Thiam to British insurer Aviv. Afterwards, the gentlemen both joined Prudential before landing together at Credit Suisse.
Some people, including David Herro, a portfolio manager at Harris Associates with a large stake in Credit Suisse, raised the issue of racial prejudice, which may have played a part in Thiam’s ouster. Herro said, “To be very frank, it seems like envy from competitors or perhaps something else given that Mr. Thiam looks a little bit different than the typical Swiss banker. Either one of these two rationales behind these attacks against him, to me are extremely distasteful.”
Other reasons were raised for the board pushing out Thiam. The share price of the bank’s stock had drastically dropped under Thiam’s tenure. His lack of any contrition or concern over the espionage and accompanying suicide, rattled the board, chairman and employees. The obvious close relationship with Bouée and the second case of spying seemed to leave Credit Suisse with little-to-no options.
On Friday, Thiam announced that he would step down as CEO and vehemently claimed, “I had no knowledge of the observation of two former colleagues. It undoubtedly disturbed Credit Suisse and caused anxiety and hurt. I regret that this happened and it should never have taken place.”
Herro has called for chairman Rohner’s resignation. He said, “This has been an exercise in very poor corporate governance. We need a board of directors really committed to good governance, and we don’t believe we have that today.”
In an official statement from the bank, Rohner applauded Thiam’s contribution to the bank, “Under Tidjane’s leadership, Credit Suisse simultaneously repurposed our strategy, restored our capital, reduced our costs, de-risked our business, promoted diversity and engendered an exceptional level of co-operation between various divisions.” Rohner wished Thiam the best of luck.
Thiam has told confidants that he has a number of potential job offers already lined up.
