The World Economic Forum announced Friday that a probe into founder Klaus Schwab uncovered minor expense irregularities but no evidence of material misconduct. The Davos-based group also confirmed changes to its board leadership following the inquiry.
Interim chairman Peter Brabeck-Letmathe, former Nestlé chief executive, resigned earlier this week after trustees met to review the findings. In a previously unreported resignation letter, he cited a “toxic” work environment and urged the board to reach an “amicable agreement” with Schwab to settle the dispute.
The Forum appointed BlackRock CEO Larry Fink and Swiss billionaire André Hoffmann as interim co-chairs to lead the board. In a statement, the board expressed a desire to move past the conflict with its founder, attributing the irregularities to blurred lines between personal contributions and Forum operations rather than intentional misconduct. It said governance had been strengthened and expressed regret to employees who felt mistreated.
Schwab stepped down as executive chair in April when the board opened its investigation into whistleblower allegations of unauthorized spending and inappropriate treatment of female staff. He denied wrongdoing and filed legal action in Switzerland against the Forum and anonymous whistleblowers, but his spokesman said Friday he intends to drop both cases.
Swiss law firm Homburger, hired to investigate, reported repeated workplace misconduct and questionable expense handling exceeding $1 million, findings Schwab disputed. The whistleblower complaint followed a Wall Street Journal report alleging a toxic culture for women and Black employees at the Forum, claims both Schwab and the organization rejected.
Source: The Wall Street Journal
