Scandal Hits Johnson Controls

October 14, 2014 By Linda Hardesty

Alex MolinaroliJohnson Controls CEO Alex Molinaroli may be on the bubble after he admitted to having an extramarital affair with a consultant to the company. The company’s board of directors has named Bruce McDonald, Johnson Controls’ chief financial officer, as vice chairman, a move that is often made when a successor is being groomed for the top job, reports the Milwaukee Journal Sentinel.

Molinaroli just became president and chief executive officer of Johnson Controls Oct. 1, 2013 and became chairman of the company Jan. 1, 2014.

Last week, Bloomberg reported that Molinaroli, 55, had an affair with Kristin Ihle, 45. Ihle’s firm, Lichter & Ihle, had worked with Johnson Controls for decades on coaching and talent development.

The affair became ugly last May when Ihle unsuccessfully sought a restraining order against Molinaroli’s wife, Patsy. According to court documents, Patsy Molinaroli had sent a threatening e-mail to Ihle. Patsy Molinaroli has since filed for divorce.

After becoming aware of the relationship, the Johnson Controls board determined that no conflicts of interest occurred. Fraser Engerman, a Johnson Controls spokesman, said in an e-mailed statement to Bloomberg. “To avoid any perception or potential future conflicts, management elected to terminate the consulting firm. Mr. Molinaroli continues in his role with full support of the board, and the company considers this matter to be closed.”

The embarrassment about Molinaroli’s affair comes at a sensitive time for Johnson Controls. The CEO has been overseeing some major restructuring, including less focus on the company’s automotive business, a move to divest the Global Workplace Solutions business and a reorganizing of its Building Efficiency business.

The restructuring may be providing Molinaroli with some job security, says the Milwaukee Journal Sentinel. It might not be good for the stock price if the company abruptly replaced its CEO in the middle of a reorganization.

2 comments on “Scandal Hits Johnson Controls

  1. Consider this: three years ago the North America BE business held a mandatory leadership call wherein corporate leaders had to spell out for managers and sales staff that they could no longer use company funds to entertain clients or hold business meetings at “gentleman’s clubs”. That’s a fact. And that was three years ago, not three decades ago.

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