As former U.S. Attorney Eric Holder released a list of recommendations to improve Uber's toxic culture, CEO Travis Kalaninck took a leave of absence, and David Bonderman stepped down from the board.
SAN FRANCISCO (AP) Its clear from former Attorney General Eric Holders recommendations on how to fix Ubers dysfunctional management that the male-dominated company grew huge without even the most basic procedures to prevent sexual harassment, bullying and other bad behavior.
The 13-page document from Holders firm Covington & Burling LLP released Tuesday exposes a startup-turned-goliath that permitted misconduct, had few policies to protect employees and ran with little board supervision.
The recommendations , adopted unanimously by Ubers board, show clearly that the next version of Uber, called 2.0 by CEO co-founder Travis Kalaninck, will have to be much different from the free-wheeling company that flouted regulations and disrupted the taxi business to become the worlds largest ride-hailing company.
Kalanick told employees Tuesday that hed be taking an indefinite leave of absence.
A culture change at Uber may be more difficult than former Attorney General Eric Holder envisions. At an employee meeting to unveil the recommendations, board member David Bonderman, a hedge fund founder, remarked that if a woman was added to the board that there likely would be more talking, according to a recording obtained by Yahoo. He later apologized for the disrespectful comment in an email.
It was inappropriate, he wrote.
By evening, Bonderman resigned from the board and put out a statement saying, I do not want my comments to create distraction as Uber works to build a culture of which we can be proud.
Bonderman, a University of Washington graduate, was announced last week as a partner in the Oak View Group, which was selected by Seattle Mayor Ed Murray as the preferred choice to renovate KeyArena.
And in another strange twist, board member and hedge fund partner David Bonderman resigned Tuesday night after making what he called an inappropriate remark about women at a meeting to explain Holders recommendations to employees.
The Holder investigation started after former engineer Susan Fowler posted a blog in February detailing harassment during the year she spent at Uber, writing that she was propositioned by her manager on her first day with an engineering team. She reported him to human resources, but was told he would get a lecture and no further punishment because he was a high performer, she wrote.
After interviewing 200 witnesses, Holder had to make such basic recommendations as setting clear policies to protect workers from harassment, and that the human resources department get a better handle on keeping records and tracking employee complaints. It even suggests such simple procedures as using performance reviews to hold leaders accountable and requiring all employees to turn in receipts so the company can make sure expenses match its values.
The recommendations definitely paint a picture of a company that was out of control and pretty chaotic, says Elizabeth Ames, a senior vice president at the Anita Borg Institute, a nonprofit aimed at advancing women in the technology business.
Holder also suggests that Uber change its written cultural values to promote positive behavior, inclusion and collaboration. The company should eliminate values that justified poor behavior, such as Always Be Hustlin, Meritocracy and Toe-Stepping and Principled Confrontation.
Holder also called for trimming Kalanicks job duties, shifting day-to-day functions to a yet-to-be-hired chief operating officer. During Kalanicks leave, his leadership team will run the troubled company.
Kalanick wrote that he needs time off to grieve for his mother, who died in a May boating accident. He also said hes responsible for the companys situation and needs to become a better leader echoing comments the 40-year-old CEO made earlier this year after a heated argument with an Uber driver over pay was captured on video.
Ames said the recommendations were strong but indicated Uber had few policies, and the ones it had were not followed.
The board unanimously approved the recommendations on Sunday, including a suggestion that a senior executive be tasked with making sure they are implemented. Apparently because of distrust of some leaders, Holder recommended that care be taken to make sure the executive is viewed positively by the employees.
The company released only Holders recommendations, not his full report, citing the need to protect employees who complained.
Liane Hornsey, Ubers chief human resources officer, said implementing the recommendations will improve our culture, promote fairness and accountability, and establish processes and systems to ensure the mistakes of the past will not be repeated.
Holder also recommended adding independent directors and replacing the board chairman, co-founder Garrett Camp, with an independent person. The board currently has eight voting members, three from within the company.
Uber was also advised to diversify its workforce. Its diversity figures are similar to the rest of Silicon Valley, with low numbers for women and underrepresented minorities. In the U.S., less than a third of Ubers workers are female.
In addition, the report says diversity and inclusiveness should be a key value thats included in management training.
After Fowler posted her blog, Uber Technologies Inc. made changes in human resources and opened a 24-hour employee hotline. Last week, the company fired 20 people including some managers at the recommendation of Perkins Coie, which separately investigated 215 employee complaints.
On Sunday, Emil Michael, Ubers senior vice president for business and a close ally of Kalanick, left the company.
Under Kalanick, Uber has disrupted the taxi industry and turned the San Francisco-based company into the worlds most valuable startup. Ubers valuation has climbed to nearly $70 billion.
Besides the harassment complaints, in recent months Uber has been threatened by boycotts, sued and subject to a federal investigation over its use of a fake version of its app to thwart authorities looking into whether it is breaking local laws.
A company can be aggressive yet have strong values, said Joseph Holt, a business ethics professor at the University of Notre Dame. He cited Starbucks as example.
Having a good reputation for ethics is a competitive advantage, Holt said.
At the employee meeting Tuesday morning, Bonderman remarked that if a woman was added to the board that there likely would be more talking, according to a recording obtained by Yahoo.
By evening, Bonderman resigned and put out a statement saying the comment was careless and inappropriate. I do not want my comments to create distraction as Uber works to build a culture of which we can be proud, the statement said.
____
Krisher and Auto Writer Dee-Ann Durbin contributed from Detroit.
See the original post here:
Uber recommendations show company was 'out of control' - The Seattle Times