Former CBS chairman and CEO Les Moonves’ departure could spell trouble as the network fights to retain high-level talent, USA Networks founder and former chairman Kay Koplovitz told CNBC on Monday.
“From a management point of view, holding the talent in place at CBS is going to be a challenge,” Koplovitz said on CNBC’s “Power Lunch.”
On Sunday evening, CBS announced Moonves will depart as chairman, president and chief executive officer “effective immediately,” following numerous allegations of sexual misconduct that spanned much of his career. The company said COO Joseph Ianniello will now act as CEO “while the Board conducts a search for a permanent successor.”
Concurrently with the Moonves announcement came news of a board reshuffling and an end to hostility between CBS and National Amusements (NAI), which owns a controlling stake in CBS. The two companies will drop their lawsuit against each other, and NAI will not pursue the merger of CBS and Viacom for at least two years. As for the board, five independent directors and one director aligned with NAI have stepped down from the board to be replaced by six new independent members.
Koplovitz called the decisions concerning CBS’ board and the deal between NAI and CBS “all very important structural issues that have been decided” but said she worried about management without Moonves. Koplovitz expressed concern executives at CBS could get picked off by other networks following Moonves’ departure.
“This is a risk for CBS, because they’ve been a top-performing network, and Les has provided that leadership to them. People could be picked off by other networks. I mean, I’m talking about the executives who are in charge of some of these wonderful series that CBS has,” she said.
It will be up to Ianniello to hold on to these high-level employees, she added. CBS is home to such popular shows as “Big Brother,” “The Big Bang Theory,” “NCIS” and “Criminal Minds.”
Beyond even retaining talent, Erika James, the John H. Harland Dean and professor at Emory University’s Goizueta Business School, said CBS leadership will be on the hook for cleaning up the company’s culture, as “culture is created from the top.”
“When you see these kinds of challenges and potential bad behaviors happening at the top of the organization, chances are that has filtered down in some ways that are going to be problematic,” James told CNBC in the same “Power Lunch” interview as Koplovitz.
She said it will be up to the next leader to set the tone at CBS.
“The challenge will be identifying the next leader who will come in, who will set expectations, who will have a set of norms and practices and standards of behavior that changes how people operate, how people engage with one another. Until that happens … it’s going to be hard to overcome what we’ve seen with CBS and other networks,” James said.
Koplovitz agreed “this issue of sexual harassment” could take a while for Moonves and CBS to sort out.
