Executives at scandal-stained companies get paid less for the rest of their careers

(Image credit: Win McNamee/Getty Images)

published 23 September 2016

Bad news for the head honchos at Wells Fargo: The bank's recently publicized bad behavior could follow them for the rest of their careers, even if they personally had nothing to do with it.

The stigma of a headline-grabbing controversy sticks with a firm's managers for years, new research by the Harvard Business Review shows. Executives who have scandal-plagued companies on their résumés are paid nearly 4 percent less for future jobs than their peers.

The researchers also found some hiring managers completely refuse to meet with candidates associated with a company that's been through a scandal, no matter how long ago the ordeal was. Employers described such applicants as "too risky" and criticized even those who claimed their hands were tied by tyrannical bosses: "Somebody with integrity who was unable to do his job would have voted with his feet."