On April 5 this year, the Royal Bank of Canada announced the termination of the contract of its CFO Nadine Ahn, implying that there had been extramarital affairs within the company; on the same day, another executive was also dismissed; both people insisted that there was no such thing as extramarital affairs and sued the bank for defamation.
It is very rare for listed companies to publicize their own executives' extramarital affairs, and even rarer for them to be sued as a result.
This happened to Royal Bank of Canada (RBC), a globally systemically important bank and also the bank with the highest market cap in Canada.
Previously on April 5th, the Royal Bank of Canada announced that the labor relationship with the company's CFO, Nadine Ahn, had been terminated immediately.
The bank stated that it had quickly launched an internal review and had hired external legal advisors to conduct an investigation upon learning of the allegations involving Ms. Ahn.
(Source: Company website)
Therefore, both of their employment relationships have been terminated.
By the way, the other person in the article is Ken Mason, the former Capital and Regular Financing Vice President of the RBC. Mason had served the Royal Bank of Canada for 23 years before being fired.
According to the latest report, both Ahn and Mason have filed lawsuits against the Ontario Superior Court of Justice, claiming tens of millions of Canadian dollars in compensation for 'wrongful dismissal'.
Among them, Ahn is seeking 50 million Canadian dollars (approximately 36 million US dollars or 0.261 billion RMB), and Mason is seeking compensation of more than 20 million Canadian dollars.
Both of them have their own families and children, and accused RBC of wrongly implying that they had extramarital affairs.
According to the lawsuit, Ahn has been working for RBC for 25 years, maintaining an 'unsullied' record in the workplace. In 2021, she was promoted to CFO and was confirmed by the bank as a potential CEO candidate, which gave her the opportunity to become the first female CEO in the bank's history.
In response to this, Royal Bank of Canada spokesman Gillian McArdle issued a statement, saying that their claims are unfounded, and the company will actively defend itself in court. According to the investigation of external legal advisors, it is very clear that both of them have severely violated the company's Code of Conduct.
How do Canadian banks investigate executives?
Although it may take more evidence and the judgment of Canadian judges to determine 'what exactly is the relationship between the two,' this case has also brought a rare opportunity for the global "onlookers" to take a glimpse into the internal operation mechanism of Canada's largest bank.
According to the lawsuit, on the evening of April 4th, Ahn received a text message from CEO Dave McKay, requesting her to come to a meeting at the company the next morning, but refused to disclose the content of the meeting.
The next day, Ahn did not see McKay, but instead an outside lawyer and a member of the employee relations team. The two people confiscated her laptop and mobile phone and interrogated her for 'two hours.'
Mason's situation was similar. He received a meeting invitation from the bank's Chief Risk Officer Hapworth and was then questioned by lawyers and HR for two hours. Mason stated that the lawyers 'ambushed him with outrageous, destructive, and defamatory false allegations' based on an anonymous complaint, charging him with an improper personal relationship with Ahn. He was initially told he would be suspended and was fired several hours later.
Both people stated that they were long-time friends, but this friendship did not cross the Bank's Code of Conduct red line. Both people claimed that their long-term friendship and professional working relationship were misrepresented by the anonymous whistleblower and the Royal Bank of Canada.