McDonald’s Corporation has terminated its CEO for having a consensual relationship with an employee. Steve Easterbrook is viewed as an effective leader who made the company leaner and made good use of technology. McDonald’s immediately announced Easterbrook’s successor as Chris Kempczinski, formerly the President of McDonald's USA.

In a news release, the company explained the decision:

“Kempczinski succeeds Steve Easterbrook, who has separated from the Company following the Board's determination that he violated company policy and demonstrated poor judgment involving a recent consensual relationship with an employee.”

In an email to employees, Easterbrook wrote, “This was a mistake. Given the values of the company, I agree with the board that it is time for me to move on.” Easterbrook’s admission made it easier for McDonald’s to be transparent about the situation. In similar CEO-departure emails, we’ll see language such as, “parted ways,” “resigned,” or “stepped down,” when we know the decision wasn’t really mutual.

Easterbrook leaves McDonald’s with $670,000 in severance pay in addition to a prorated bonus and stock options.

Easterbrook image source (home page). Kempczinski image source (this page).

Discussion:

• What’s your view of how McDonald’s announced the decision in the news release? What are the benefits to the company of describing what happened rather than being vague?

• Did McDonald’s do the right thing by terminating Easterbrook for a consensual relationship? Why or why not?