Personal Crisis: The Impact on CEOs and Their Companies

Zak Goldberg  |

The role of a leader, such as the CEO of a multinational company, is a position of great responsibility. It is their vision and business acumen that steers the company to meet its goals and to operate effectively. Not only is the success and profitability of the company at steak, but so too are the lives of the people who work for the company, the customers and clients that the company serves. So, what happens if, as leader, the CEO experiences a personal crisis of some kind – a divorce for example?

Here we explore the potential impact a personal dispute could have on a CEO and their multinational company.

The Concentric Ripple of Responsibility

In the short term, it may be that when experiencing a personal dispute, the CEO of a multinational company needs a little time to work out how they will deal with the situation. While a personal crisis, such as divorce, can be all consuming, quickly formulating a strategy that means business and personal interests are kept separate is paramount, particularly if it looks like the personal dispute is likely to be volatile.

In such circumstances, the responsibilities of running of the company may fall to other members of the senior management team. This is crisis management, of sorts and needs to be kept short so that the CEO can return to running the company in a focused manner.

Behind the Scenes

Once the CEO has determined some stability in their lives and has worked out a way to separate work from what is happening in their personal life, they would be well advised to seek some kind of dispute resolution. Using the services of experts to act as mediators will often bring about an equitable and timely end to a dispute.

Taking this route is proactive and it can mean that the individuals involved can avoid lengthy and expensive court procedures further down the line.

Cause and Consequence

If the personal crisis is not handled correctly, then the consequences for the company could be significant. The absence of the CEO or the effect that the situation has on their ability to run the company as normal is likely to lead to one or more problems.

The confidence of investors may be an issue and if this is not put into check, then they may start to sell off their interests – a snowball effect could ensue and in the worst-case scenario, this could lead to the demise of the company.

Customers and clients may notice that the service the company provides is not up to its usual standards and therefore business may start to wane somewhat.

No matter how big or small the impact felt by the company, the end result will be that the consequences will have to be addressed and as senior managers will know, it takes much longer to build something than it does to knock it down.

Avoiding any negative impact from the outset is a much smarter way to proceed and separating business interests from those of a personal nature, then resolving the dispute quickly is vital.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to:


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