Norfolk Southern Axes CEO Over Relationship with Chief Legal Officer
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Norfolk Southern CEO Alan Shaw has been terminated by the railroad’s board of directors for cause after an investigation determined he violated policies by engaging in a relationship with the company’s top lawyer.
The board unanimously voted vice president and chief financial officer Mark George as Norfolk Southern’s new president and CEO, effective immediately. George will also join the Norfolk Southern board.
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“The Board has full confidence in Mark and his ability to continue delivering on our commitments to shareholders and other stakeholders. Mark has played an integral role in our recent progress and brings decades of financial experience and strong operational expertise. He embodies our corporate values and is a champion of our safety culture,” said Claude Mongeau, chairman of the Norfolk Southern board, in a statement. “In close partnership with our accomplished COO, John Orr, they will continue to improve NS’ operating performance and close the margin gap with peers.”
Nabanita Nag, who had been in the relationship with Shaw, has been terminated from her roles as executive vice president corporate affairs, chief legal officer and corporate secretary, effective immediately.
The Class I railroad first confirmed the probe Sunday night, with numerous news outlets reporting afterward that Shaw was expected to step down from his role due to the alleged relationship.
At the time, the railroad said Shaw’s potential conduct was inconsistent with its code of ethics and company policy.
In the Wednesday statement, Norfolk Southern said Shaw’s departure was unrelated to the company’s performance, financial reporting and results of operations.
Having worked at the company since 1994, Shaw was appointed CEO of Norfolk Southern in May 2022. Shaw’s tenure was put under the microscope less than a year after when a Norfolk Southern train derailed in East Palestine, Ohio in February 2023. That accident resulted in the spillage of hazardous chemicals that forced town residents to evacuate for days and posed environmental risks to the area.
The company has to pay $600 million to impacted residents in a 20-mile radius as part of a class action complaint, as well as $310 million more for federal-related claims—both of which are part of $1.7 billion in total costs Norfolk Southern has incurred as part of the derailment.