Executives with scandal-tainted firms pay penalty in job market

An article published in the Harvard Business Review (HBR) in its September 2016 issue has said that according to its research, "executives with scandal-tainted companies on their resumes pay a penalty on the job market, even if they clearly had nothing to do with the trouble". Overall, these executives are paid nearly four per cent less than their peers. And given that initial compensation in a job strongly affects future compensation, the difference could become significant over a career, it said.

Citing the HBR article authored by Boris Groysberg, Eric Lin, George Serafeim and Robin Abrahams, Bloomberg's Suzanne Woolley wrote: "Initial compensation at these executives' next job is about 10 per cent lower than for that their untainted counterparts, the authors found. Across industries, job functions, levels of seniority, and regions, executives with such companies on their resumes took a cut of four percent in total compensation. Women were dinged seven per cent to men's three per cent."