(Reuters) – Norfolk South (NYSE:) said late Sunday that it has opened an investigation into allegations of possible misconduct by CEO Alan Shaw.
The company said its audit committee is working with a law firm “to conduct an independent investigation into the allegations.”
CNBC had first reported, citing people familiar with the matter, that Shaw had an inappropriate working relationship.
Shaw did not immediately respond to a request for comment on the investigation.
In May, activist investor Ancora won three board seats at the railway company but failed to oust the railway’s CEO.
Ancora had proposed that investors remove Alan Shaw from the board and select Jim Barber, a former chief operating officer at UPS, so he could eventually replace Shaw as CEO. They also introduced Jamie Boychuk to become Chief Operating Officer.
Shaw was appointed CEO in May 2022, replacing Jim Squires.
The hedge fund argued that new blood was needed to improve its financial and operating figures and said it would continue to hold the company accountable for any future rail accidents or underperformance.
The Atlanta, Georgia-based company reported operating revenue of $3 billion in the second quarter, up 2% from last year, narrowly missing analysts’ estimates of $3.04 billion.
(This story has been corrected to say Shaw was named CEO in May 2022, not that he joined Norfolk Southern in May 2022, in paragraph 7)
