Inappropriate relationship with an employee ended Best Buy CEO Brian Dunn

Best Buy CEO Brian Dunn resigned abruptly, with the company announcing that an internal investigation had found evidence of an "inappropriate relationship" with a female employee. The departure was swift and the circumstances, once reported, generated the kind of corporate governance conversation that attends executive misconduct with predictable regularity.

Dunn, who had risen through Best Buy's ranks over 28 years and had been CEO since 2009, was described by the investigation as having shown poor judgment in his behavior. The board moved quickly once the investigation concluded, accepting his resignation and conducting its own subsequent review.

The subsequent review, however, created additional complications for the board itself. An audit committee investigation found that the board's chairman, Richard Schulze, had been told by an employee of Dunn's relationship months before it became the subject of a formal investigation — and had failed to report it to the full board as corporate governance protocols required. Schulze ultimately resigned as chairman.

The dual accountability — the CEO for the relationship, the chairman for failing to report it — illustrated the importance of governance structures that create clear obligations and escalation paths for sensitive information. When those paths are blocked by personal relationships or loyalty, the consequences extend beyond the initial misconduct.

Best Buy was, at the time of the scandal, facing serious competitive pressure from Amazon and other online retailers. The governance disruption added a leadership crisis to a strategic one at an inopportune moment.

Dunn subsequently acknowledged the relationship and expressed regret. Schulze later made an unsuccessful attempt to take the company private.