Executive Divorces: The Action Moves To The Boardroom
Ending a marriage is more expensive than ever for high-earning executives. Wealth and status only serve to complicate the already painful and traumatic experience of ending a relationship, possibly being separated from your children and having to start a new life. Worryingly, when their marriages end in divorce, executives are finding themselves having to hand over large sums of money, stakes in their businesses and sensitive competitive information.
“Companies are being dragged onto the battlefield,” says Liza Segal, an advocate specialising in divorce and family law and co-founder of Ad Idem, a family and divorce settlement mediation company. “As a result, divorce is no longer a personal issue, but one that impacts the organisation too. Divorce can be ugly. It leaves people unable to focus, depressed, and worried about the future. Added to the emotional anxiety are the logistical and practical requirements which impede efficiency in the workplace.”
In the case of senior management, their behaviour impacts shareholders, business partners, employees, suppliers and customers. “When a CEO’s performance is hampered, company value is affected,” says Deanne Kahn, an attorney specialising in divorce and family law and Segal’s business partner. “This makes divorce even more heinous than it already is. People look up to CEOs, CIOs and CFOs and the way they are perceived impacts the impression the public has of the company and the brand.”
During a messy divorce allegations about a CEO’s behaviour often emerge. The sordid details become a matter of public record and are lapped up by the media. As the relationship becomes more hostile, there will be an incessant flow of applications and counter applications, pleadings and affidavits – all of this costing many working hours and keeping leaders in consultation with their legal teams and in court for weeks on end. Colleagues may be subpoenaed to provide testimony, and employees throughout the company may be called on to help build an angry spouse’s case, impacting the entire organisation and costing it time and money.
“These are just some of the reasons why the best way to deal with divorce is as quickly and effectively as possible,” says Segal. “Litigation is extremely expensive and the longer the divorce takes, the worse the effects on everyone involved.
Divorce settlement mediation is the sensible way for couples to work out the terms of their divorce, saving both parties significant time and money. It is without prejudice and it’s confidential. Choosing mediation also results in far less stress during the process. This means performance at work is less likely to be impacted.
“Dissolving the marriage in a non-litigious manner benefits everyone,” says Kahn. “Instead of appointing two separate attorneys to litigate the divorce, both parties consult with a family law practitioner. The mediator, an expert in child and family law, provides guidance for the couple on the anticipated range of likely court outcomes and helps them to reach a mutually acceptable resolution that is in their best interests.”
Unlike a litigated divorce, a mediated one remains private. The conclusion is determined by the two spouses, both of whom have a financial and emotional interest in the success of the process.
This is not only the quickest route to follow, but it is also the most cost-effective and can save both parties vast amounts of money which go towards the often merciless process of litigation in a divorce which involves people who are affluent.
“The benefits to the business are just as great,” Segal points out. “By choosing the mediation route, high-ranking executives who are going through a divorce are able to conclude the process and move on with their lives with as little disruption as possible, and with minimal damage to their reputation and that of the company. It’s a critical consideration for those who have a responsibility to all the stakeholders in a company.”
The message is clear: exposing yourself to protracted and acrimonious litigation will impact your life on every level. Don’t let the dispute and the resulting acrimony spiral out of control. Instead, once you have agreed to separate, take immediate action and bring the situation to a close.
*Liza Segal & Deanne Kahn are directors of Ad Idem.
Cher Heystek, Ad Idem, 011 268 2095, firstname.lastname@example.org
Usman Aly, Predictive Communications, 011 452 2923, email@example.com[Back]