Firing a Toxic Executive Is the Highest Impact Thing a CEO Can Do
A CEO’s job is to set a clear vision and ensure it's executed. That includes building an executive team that not only excels in their own domains, but also works together as a cohesive unit. A CEO cannot afford to have their executive team in dysfunction. Even small misalignments among executives amplify into big misalignments as you go down in the org chart towards individual contributors. And when an executive team is completely dysfunctional the effects can be catastrophic.
Nearly every time I’ve run into a severely dysfunctional executive team where executives are angry, misaligned, and don’t even like to meet together, the primary cause is that there is one toxic executive who is the cause of this strife.
Here are some common toxic behaviors that derail executive teams:
Political maneuvering: prioritizing their own power over company success
Backstabbing and blame-shifting: eroding trust among the executive team
Overly critical without being receptive to feedback: discouraging open discussion
Creating a fear-driven culture: making others hesitant to speak up or collaborate
Disrupting team cohesion: preventing alignment and productive collaboration
In this article, I will use “toxic executive” as shorthand for an executive who is exhibiting enough toxic behaviors to a high enough degree that they are causing a dysfunctional executive team.
Cases like this inevitably end in the toxic executive eventually being fired or happening to leave on their own. The question is, how much time the CEO will let this persist. Every day this continues, the more distrust the other executives have of the CEO (often resulting in other executives leaving the company) and the more misaligned the entire company becomes.
Unlike other key responsibilities of the CEO where the solution is much more nebulous, firing a toxic executive is the most clear and guaranteed high leverage action a CEO can take. But even the best CEOs can fall into this trap. I spoke with a CEO of a company in the S&P 500 who said that their executive team hadn’t met regularly for an entire year due to one executive they eventually fired.
So what makes firing a toxic executive so difficult? In my work, I've seen three common traps:
Trap 1: What’s actually an individual seems like the group
When there is discontent in any group, it can be hard to see that it’s just one (or sometimes two) individuals who are causing a disproportionate amount of problems and disruption.
This individual vs. group conflation phenomenon shows up everywhere, not just executive teams. I experienced this multiple times while leading engineering and product teams. For example, there was a case of two teams that had a terrible relationship with each other. Once one person was fired, everything changed. Like everything. We didn’t even have to do anything else to cause those two teams to start having a great relationship. Another example was from a working group that couldn’t seem to get agreement about a direction to take. It felt like there were two sides intensely battling every time we met. Then just one of the group members happened to leave and we noticed that one of the sides in the debate was just one person who wouldn’t disagree and commit.
After pivoting my career to coaching and advising CEOs, I saw the same pattern play out at the executive level, but with far more damaging consequences.
When there is an executive causing the entire executive team to not operate as a trusting and productive unit, often the CEO will sink a bunch of unproductive effort into team building within the executive team, which will never result in any progress until the toxic executive leaves. Doing team building exercises instead of first addressing the biggest root cause only furthers resentment and disengagement among the other executives, many of whom already know that the one toxic executive is the cause of the problems.
How to see the signs: You probably have a couple executives venting to you about this executive and a few more subtly hinting at this. Listen to them. You may not have seen bad behavior from this toxic executive because they’ve hid it from you and it happens behind closed doors.
How to see the signs: Your executive team building offsites and other cohesion efforts haven’t worked.
Trap 2: Thinking the executive is otherwise a high performer
CEOs can fall into a trap of thinking, “yes, they are causing big issues on the executive team, but they are such a high performer.” The problem with that line of thinking is that it’s impossible for an executive who causes big issues within the executive team to be a high performer. Contributing positively to the executive team is part of their performance.
Furthermore, company departments don't exist in a vacuum. If the Head of Product and Head of Marketing aren’t meeting with each other, then the Product and Marketing departments will not build or operate in cohesion (which is hurting both executives’ performance in running their department). Causing an executive team to be dysfunctional leads to a dysfunctional company and is therefore a case of low performance no matter what.
You’re better off with a less experienced executive (interim or otherwise) running a department than someone who is causing negative effects across all departments.
How to see the signs: Ask yourself: “What is this executive's total contribution (positive and negative) to the health and success of this company?”
Trap 3: Letting fear get in the way
Toxic executives can be scarier to deal with than other executives since the toxic behaviors that are causing massive dysfunction in the executive team are the same behaviors that may surface in a 1:1 conversation you have with them about their underperformance. When you add this to the general fears that come up for people around difficult conversations, this can create a lot of fear. When the amygdala part of our brain is in a fear state, our frontal cortex will come up with all kinds of elaborate reasons why it makes sense not to address this situation.
How to see the signs: When you think about managing out this executive, what do you experience in your body and mind? What emotion(s) is this consistent with?
How to see the signs: Ask yourself, “If I were an advisor to a CEO in my exact same situation, what would I advise?”
How to execute on this
Every situation is different including the magnitude of the disruption caused by an executive. Sometimes the executive isn’t full blown toxic and they can actually be performance managed to change.
The key is to remember that these are, in fact, cases of underperformance and therefore can be managed with the same principles behind managing any other case of underperformance. The only difference here is that this kind of underperformance is more damaging to the company than any other kind.
I’ve written an article (see here) that has five principles that will help you successfully navigate this and any other case of underperformance.
In addition, remembering one or more of these can help provide the motivation to move forward:
You will manage this person out eventually. The only question is how much more damage you’ll let them do before you act.
Your best executives are deciding whether to stay as this situation persists.
You knew this job would require doing hard things, and this is one of them.
You do not have a high performance culture if you’re not modeling this at the top.
Think of the end state. What will it be like to have a well-functioning executive team that energizes you instead of drains you?
How much better will your top performers operate when this stressor is gone?
And, of course, do your standard checks with employment lawyers, HR, etc. since each country and state/province have different laws and standards about how to manage people out.
Once you’ve performance managed the toxic executive who has been disrupting your executive team, everyone on the team will breathe a collective sigh of relief.