Balsillie Resigns as RIM ChairmanBy Wayne Rash | Posted 2007-03-05 Email Print
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BlackBerry maker says it will restate its 2006 earnings. Balsillie will remain co-CEO.Research In Motion Chairman and co-CEO Jim Balsillie will step down as chairman of the Canadian maker of the popular BlackBerry device. The resignation comes in the wake of reports that the company misstated $250 million in stock options. Balsillie will stay on as co-CEO of RIM. According to a statement released by the company today, RIM will restate its 2006 earnings by $250 million. The error came to light following an accounting review.
A new chairman has not been named. RIM Chief Financial Officer Dennis Kavelman is being moved to a new position as chief operating officer for administration and operations, and two board members, Kendall Cork and Doug Wright, have also resigned. The RIM board is undergoing reorganization and increasing its size from seven to nine members, according to the statement.
In the statement, the company said the roles of chairman and CEO are being separated to comply with "current best practices in corporate governance." The accounting review was initiated as a result of a requirement to meet the guidelines of the Ontario Securities Commission, as well as the Securities and Exchange Commission in the United States. While RIM is based in Waterloo, Ontario, its stock is also traded in the United States.
"Speaking on behalf of the Board and the senior management of RIM, we are treating this issue very seriously and have already made significant progress in rectifying this matter. We are also committed to evolving our processes to be consistent with our philosophy of achieving excellence throughout RIM's operations," said Balsillie and President and Co-CEO Mike Lazaridis in a prepared joint statement included in the release.
Check out eWEEK.com's for the latest news, reviews and analysis on IT management. RIM did not say who would be appointed to serve as CFO. However, the company did say a new internal audit department will be created within RIM. The audit review found no intentional wrongdoing on the part of Balsillie.