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CBS directors discuss whether Leslie Moonve's step should be set aside



Some directors of CBS Corp. discussed at the weekend whether the chief executive

Leslie Moonves

he should retire from the company until the investigation into allegations of sexual harassment has been made, according to those familiar with the case.

The board of CBS, which is scheduled to meet this Monday before the second quarter by telephone conference announcement Thursday, is expected to elect a special committee to oversee the investigation, the people said. The board intends to conduct a comprehensive study of CBS's work culture, not just the alleged conduct of Mr. Moonves,

The investigation is a reaction to a New Yorker article published on Friday in which six women who had professional business dealings with Mr. Moonves between the 1

980s and the late 2000s claimed he sexually harassed her. The story alleged that CBS tolerated systemic harassment against women.

"I think the Board as a whole recognizes that this is a very, very, very serious situation, and while there is an important Les piece, it is more important for the company as a whole to have serious issues in it Relating to culture and harassment throughout the company, "said one person who was familiar with the matter.

The Wall The Street Journal reported Friday that the CBS board was planning to hire an outside law firm to conduct the probe

. Moonves expressed regret in the New York article about any behavior that made women uncomfortable, but denied that he retaliated by injuring someone's career after being rejected.

The pressure on Mr. Moonves comes when he and CBS are in a lawsuit with controlling shareholder National Amusements Inc. and its president,

Shari Redstone,

about her desire to unite CBS with his sister company

Viacom
Inc.

Failure by Mr Moonves to survive the crisis could increase the chances of a merger as his opposition to the proposed Combined Company's management team helped to derail the talks, a close observer of the Redstone media empire [19659003] The board has been split over the last few months, with a handful of Directors loyally supporting Ms. Redstone and a larger number of associates with Mr. Moonves and the management. It is unclear whether the New York revelations will change that dynamic.

Board members differ on the question of whether Mr. Moonves needs to get out before the investigation, people who were familiar with the matter said. On Friday, the independent directors expressed their full support for CBS's current management team when they requested an investigation.

Mr. Moonves acts as Executive Chairman of the Board and as Chief Executive.

The Special Committee is expected to select a law firm by the middle of this week to conduct the investigation, people said. A list of potential companies has already been created. This committee is also likely to decide if Mr. Moonves should cancel until the investigation, people said.

Supporters and critics of Mr. Moonves began settling over the weekend. On Sunday, Zephyr Teachout, a candidate for New York Attorney General, tweeted "CBS must suspend Moonve's pending investigation, so there's no fear of retaliation among employees."

Meanwhile, Bucknell University, Mr. Moonves & # 39; Alma Mater, Scrubbed Their Website The content of Mr. Moonves, who tells WNEP-TV, "Bucknell will not stand for sexual misconduct – on campus or beyond. In light of the allegations against Mr. Moonves, we have removed him from certain pages of our website that celebrate his relationship with the university, and we are considering other actions that may be appropriate. "

Some senior CBS executives and actresses who worked with him has publicly expressed support for Mr. Moonves, including the Advertising Sales Manager

Jo Ann Ross

and program guides

Angelica McDaniel.

People who are familiar with Mrs. Redstone's thinking stress that she has no preconceived notions about the investigation and that she wants to run her course before making any decisions.

In May, CBS directors turned to weaken National Amusements and Mrs. Redstone's influence on the company by distributing a dividend that reduced the vote of National Amusements from 80% to around 20%.

National Amusements amended the CBS's Articles of Association requiring approval from a super majority of directors for such action. The fight has spread to a court in Delaware and is expected to go to trial in the fall.

Some media chiefs believe that if the investigation confirms the allegations described in the New York article, it will increase the likelihood of settlement

This in turn could increase the likelihood of a merger between CBS and Viacom, some analysts and media executives said ,

CBS and Viacom were in merger talks earlier this year and went so far as to agree on a price until the management issues were resolved, including who would succeed Mr. Moonves.

Please contact Keach Hagey at keach.hagey@wsj.com and Joe Flint at joe.flint@wsj.com


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