Hewlett Packard ("HP") recently announced that CEO Mark Hurd is stepping down and CFO Cathie Lesjak has been appointed interim CEO.  According to the press release, Hurd, 53, is resigning amid sexual harassment charges by a former HP contractor.  The probe found that Hurd had personal relations with a contractor who received number inappropriate payments from the company.  According to HP's General Counsel, Mike Holston, "Mark demonstrated a profound lack of judgment that seriously undermined his credibility and damaged his effectiveness in leading HP.  Below is the official statement from HP and our interpretation, in "laymen's terms".

HP today announced that Chairman, Chief Executive Officer and President Mark Hurd has decided with the Board of Directors to resign his positions effective immediately.

INTERPRETATION:  Mark went kicking and screaming.  We gave him an ultimatum.  Resign before we fire you.  If Mark was arrogant enough to sexually harass a female employee of the company, do you really think he would resign under his own volition?   

The Board has appointed CFO Cathie Lesjak, 51, as CEO on an interim basis. Lesjak is a 24-year veteran of the company who has served as HP’s CFO and as a member of the company’s Executive Council since January 2007. She oversees all company financial matters and will retain her CFO responsibilities during the interim period.

INTERPRETATION:  Lesjak lobbied for the CEO position on a full time basis but we [the Board] doesn't think she has the "executive presence" necessary for the CEO job.

Hurd’s decision was made following an investigation by outside legal counsel and the General Counsel’s Office, overseen by the Board, of the facts and circumstances surrounding a claim of sexual harassment . . .  The investigation determined there was no violation of HP’s sexual harassment policy, but did find violations of HP’s Standards of Business Conduct.

INTERPRETATION:  Hurd didn't violate HP's sexual harassment policy, but it wasn't from a lack of trying.

Hurd said: “As the investigation progressed, I realized there were instances in which I did not live up to the standards and principles of trust, respect and integrity that I have espoused at HP and which have guided me throughout my career. After a number of discussions with members of the board, I will move aside and the board will search for new leadership. This is a painful decision for me to make after five years at HP, but I believe it would be difficult for me to continue as an effective leader at HP and I believe this is the only decision the board and I could make at this time.

INTERPRETATION:  I didn't admit to anything.  But after HP and the lady in question showed me irrefutable evidence that I tried to "push up", I had to fold 'em.  The comment about ". . . principles, trust, respect, integrity which have guided me throughout my career", is wordsmithing at its best.  This isn't the first time I have used my executive position to spit game to females in the workplace and it won't be my last.  The pain I feel is due to the fact that my ego has been bruised and people can now see that the image I portray in no way reflects who I really am. 

Hurd said:  "I want to stress that this in no way reflects on the operating performance or financial integrity of HP.”

INTERPRETATION:  Shakespeare would say "Thy protest too much".

“The corporation is exceptionally well positioned strategically,” Hurd continued. “HP has an extremely talented executive team supported by a dedicated and customer focused work force. I expect that the company will continue to be successful in the future.”

INTERPRETATION:  HP's Public Relations department made me say this.

Robert Ryan, lead independent director of the Board, said: “The board deliberated extensively on this matter. It recognizes the considerable value that Mark has contributed to HP over the past five years in establishing us as a leader in the industry. He has worked tirelessly to improve the value of HP, and we greatly appreciate his efforts. He is leaving this company in the hands of a very talented team of executives."

INTERPRETATION:  The executives at HP are so talented we had to look outside for a new CEO. 

"This departure was not related in any way to the company’s operational performance or financial condition, both of which remain strong. The board recognizes that this change in leadership is unexpected news for everyone associated with HP, but we have strong leaders driving our businesses, and strong teams of employees driving performance.”

INTERPRETATION:  HP's Public Relations department told us to say this.

Lesjak has taken herself out of consideration as the permanent CEO but will serve as interim CEO until the selection process is complete. Candidates from both inside and outside the company will be considered. The selection of a new chairman will occur in conjunction with the CEO decision.

INTERPRETATION:  We told Lesjak that in no way would she ever be CEO.  We decided to put it in writing, just in case she has a sudden loss of memory or HP's operating results and stock price exceeds our expectations during her tenure.