Best Buy is in a tenuous position with news that the company’s founder Dick Schulze has stepped down due to the implications of a “personal conduct” scandal that rocked the company.
The move comes about a month after former Best Buy CEO Brian Dunn abruptly resigned his position following months of investigation into allegations of misconduct in the workplace. Dunn, who is in his early 50s, had been with Best Buy since the 1980s and was accused of having an inappropriate relationship with a subordinate female employee more than 20 years his junior at the time of the alleged behavior.
A newly released internal investigation notes that Dunn “violated company policy [at Best Buy] by engaging in an extremely close personal relationship with a female employee that negatively impacted the work environment.” Further, while CEO Schulze is alleged to have known about the relationship between Dunn and the employee, he is said to have discussed the matter privately with Dunn in lieu of handling the transgression through the proper channels.
The report following the internal investigation at Best Buy notes that Schulze did not make board members aware of the looming problem after he spoke privately with Dunn, and explains:
“Following this conversation, the chairman did not share information about the conversation, the CEO’s denial, or any of the related allegations with the audit committee, the general counsel, the head of human resources, the chief ethics officer or any other board member.”
In a statement, Best Buy’s founder admits the findings of the report and explains his reasoning for the decision:
“…when the conduct of our then-CEO was brought to my attention, I confronted him with the allegations (which he denied), told him his conduct was totally unacceptable and contrary to Best Buy’s policies and everything I, and the company, stand for. I understand and accept the findings of the audit committee.”
Though both Dunn and the unnamed employee in question deny an improper relationship occurred, Best Buy’s internal audit reports “disruption in the workplace, damaged employee morale and perceived favoritism that undermined the employee’s supervisor’s attempts to manage her” resulting from the former Best Buy CEO’s behavior.