Credit RBC With Intriguing Disclosure of CFO Sack

Thom Weidlich 04.11.24


Royal Bank of Canada on Friday fired its chief financial officer for allegedly violating company rules by having “an undisclosed close personal relationship with another employee.” RBC issued a pretty transparent press release, and certain aspects — both the typical and atypical — are worth highlighting.

The ousting of Nadine Ahn, who became CFO in 2021 after helming investor relations, got a fair amount of coverage, including a story in The Sunday Times of London headlined, “One of Banking’s Leading Women Fired Over Secret Relationship.”

Announcing a C-suite firing is a delicate matter. RBC made some interesting moves. The version of its press release on Canada Newswire is timestamped 8 p.m. ET on a Friday, a good time to bury a story. RBC really didn’t want the news to be noticed.

The company also headlined the press release in the blandest way possible: “RBC Announces Changes to Its Executive Team.” The deck takes the common tack of starting with the good news of Ahn’s interim replacement: “RBC appoints Katherine Gibson Interim Chief Financial Officer Following the Departure of Nadine Ahn.”

Forward Movement

Focusing on the forward movement is understandable, though some may see it as cowardly. RBC did mention in the first paragraph that Ahn’s “employment was terminated by RBC earlier today, effective immediately.”

It also got to what everyone wanted to hear about right in the next paragraph:

“RBC was recently made aware of allegations involving Ms. Ahn and immediately launched an internal review and engaged outside legal counsel to investigate. The investigation found evidence that, in contravention of the RBC Code of Conduct, Ms. Ahn was in an undisclosed close personal relationship with another employee which led to preferential treatment of the employee including promotion and compensation increases. As a result, the two individuals have had their employment terminated.”

RBC was recently made aware of allegations involving Ms. Ahn and immediately launched an internal review and engaged outside legal counsel to investigate.

— Royal Bank of Canada

It’s interesting how much RBC packed into a 227-word press release and especially that paragraph. We learn that there was a whistleblower (“made aware of allegations”), that an outside law firm was hired to investigate and that the relationship led to the unnamed employee getting preferential treatment, which is an unusual disclosure.

C-Suite Behavior

Companies are becoming more transparent with these sorts of announcements — they’re getting religion about the possibility of questionable C-suite behavior harming a firm’s reputation.

Because Ahn was CFO, RBC also felt the need to mention: “The investigation found no evidence of conduct by the former CFO or the other employee with respect to the bank’s previously issued financial statements, RBC’s strategy or its financial or business performance.”

So there you have it. Pretty bold. No standard excuses such as Ahn moving on for other opportunities or to spend more time with family. There was also no praise of her work at the bank.

Photo Credit: JHVEPhoto/Shutterstock

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