Uber CEO to Take Leave as Board Adopts Sweeping Reforms

James Marshall
June 14, 2017

The Chief Executive Officer of Uber, Travis Kalanick, on Tuesday said he was taking an indefinite amount of time off from the company, which is now in the throes of controversy over its hostile work culture, in particular for women.

Uber's board unanimously accepted former Attorney General Eric Holder's recommendations for improving the company.

The report, recommendations of which were adopted by the board, said Uber "should reformulate its written cultural values" to "reflect more inclusive and positive behaviors".

Kalanick, 40, did not say how long he would be away from Uber, the ride-hailing firm that he helped turn into the world's most valuable venture-backed company, but has run into problems due to its rough-and-tumble approach to regulations and its own employees.

"The ultimate responsibility for where we've gotten and how we've gotten here rests on my shoulders", wrote Kalanick, who also cited the need to grieve the death of his mother in a recent boating accident as a primary reason for stepping back. He did not say how long he would be away.

"During this interim period, the leadership team, my directs, will be running the company", Kalanick wrote in his e-mail.

"There's a lot of data that shows that when there's one woman on the board, it's much more likely that there will be a second woman on the board", board member Arianna Huffington said, according to leaked audio published by Yahoo Finance.

The company released only Holder's recommendations, not his full report, citing the need to protect employees who complained.

Uber's board said it would review Mr Kalanick's responsibilities and reassign some to others.

Bonderman has reportedly apologized in an email to staff. Uber's PR team later reweeted a Times reporter's post with an excerpt from the apology, where Bonderman called it a "disrespectful comment" and saying "I deeply regret it". The report also recommends adding more independent directors and replacing its chairman, Uber co-founder Garrett Camp, with an independent chairman. The report also exhorted the company to "institute and enforce clear guidelines on alcohol consumption and the use of controlled substances" and "prohibit romantic or intimate relations between individuals in a reporting relationship".

Susan Fowler posted a blog in February that detailed harassment during the year she spent at Uber. She received applause from employees, according to the source at the meeting. The company has been searching for a No.2 executive for more than three months and is also looking for a chief financial officer.

Holder's firm, Covington & Burling LLP was hired to examine Uber's workplace culture after a former employee leveled charges of sexual harassment. Last week, it hired Harvard Business School's Frances Frei as senior vice president of leadership and strategy, and will add Nestle SA's Wan Ling Martello as an independent director. The board will also create an oversight committee to monitor issues such as diversity and an audit committee to oversee spending, and improve the company's gender and racial diversity.

Mr Kalanick told employees about his decision in a memo on Tuesday. They include Ryan Graves, head of operations and one-time chief executive at Uber.

Uber now operates in hundreds of cities and more than 80 countries, accounting for bookings of some $20 billion a year ago.

Uber has suffered a series of damaging setbacks in recent months, including a federal probe into the company's use of technology to evade regulators in certain cities and a trade secrets lawsuit filed by Alphabet Inc's self-driving unit, Waymo.

A statement released by early Uber investors Mitch and Freada Kapor said they were encouraged by the "thoughtful and extensive" recommendations. "Sometimes we conflate great business leaders with strong personalities with great governance".

Other reports by Click Lancashire

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