Garth Saloner, dean of the Stanford University Graduate School of Business, will be stepping down at the end of the current academic year in the wake of a lawsuit filed by a former faculty member whose wife Saloner had a romantic relationship with, according to the university.
Stanford announced Saloner's resignation in a statement Monday that described his concerns over a "baseless and protracted lawsuit" that James Phills, the former faculty member, filed against Saloner and the university in April 2014. Phills' lawsuit claims that he was the victim of discriminatory treatment at Stanford, according to the university, who, with Saloner, is challenging the lawsuit.
"At all times Dr. Phills was treated fairly and equitably," the university said in a statement.
Phills first came to Stanford in 2000 when his wife was appointed a tenured member of the Graduate School of Business Faculty. Three years later, he became a faculty member in a non-tenured position, according to the university. He and his wife separated in 2012 and have been engaged in ongoing divorce litigation since.
"Several months after the couple's separation, Dr. Phills' estranged wife and Dean Saloner, who was widowed, began a relationship," the university statement reads. "The dean informed Stanford leadership at the very beginning of the relationship, and others in the university took responsibility for final decision-making about matters involving Dr. Phills and his wife."
University policy requires notification and recusal in sexual or romantic relationships between adult employees, including faculty, when one has authority over the other, even if the relationship is consensual.
The policy notes that while consensual sexual or romantic relationships between adult employees are not in general prohibited, "relationships between employees in which one has direct or indirect authority over the other are always potentially problematic."
Stanford terminated Phills' employment this year when he failed to return after multiple leaves of absence the university had granted him for "lucrative opportunities in Silicon Valley," including a stint at Apple, the university said. These leaves went "beyond what is normally allowed under university policy," Stanford noted.
"Dr. Phills ultimately chose to continue his more lucrative employment at Apple," the university said.
Saloner, who has been dean of the world-renowned business school since 2009, announced his resignation in a letter to the Graduate School of Business community on Monday, the opening of the school's academic year.
"As many of you know, the university and I have been vigorously defending a baseless and protracted lawsuit related to a contentious divorce between a current and former member of our faculty," Saloner wrote. "I have become increasingly concerned that the ongoing litigation and growing media interest will distract all of you from the important work that you are doing and unfairly impact this stellar school's deserved reputation."
Saloner, who first arrived at the Graduate School of Business in 1990, said he plans to return to teaching and research as part of the school faculty, and made the announcement now to "allow time to plan for a smooth transition," the university statement reads.
Stanford's official press release on Saloner's resignation note the curricular, financial and physical advances he has overseen during his six years at the helm of the business school. He oversaw the adoption of a new Master in Business Administration curriculum, the opening of the state-of-the-art Knight Management Center and the launching of entrepreneurship and leadership programs in developing nations, according to the university. The school has raised more than $500 million in private funding since he became dean.
U.S. News & World Report named the Stanford Graduate School of Business the No. 1 school in the nation for 2016.
Saloner has also focused his efforts on diversifying the School of Business, the university said. Women comprise 41 percent of current MBA students and make up 54 percent of new faculty members hired in the past two years. Four of the five GSB volunteer boards are led by women and 30 percent or more of their members are women, according to the university.
The school faculty has increased by 17 percent since 2009 to 124 tenure-line faculty members. Lecturers and other teaching staff have almost doubled to 90 under Saloner's leadership, the university said.
Saloner is also one of only two faculty members to have won the Distinguished Teaching Award at the Stanford Graduate School of Business twice, first in 1993 and again in 2008, the university said.
"It is with great regret that I accept Garth's resignation, which I know was a difficult decision," Stanford President John L. Hennessy stated in the press release. "It has been a very successful tenure. Under his leadership, the business school has been a leader in transforming management education to address the world's economic challenges.
"He has expanded its international impact and he implemented an academic vision to train insightful, principled leaders who can drive global change. We are grateful to Garth for his service and his many contributions as dean, and look forward to his continued contributions to teaching and research at the GSB for many years to come."
Provost John Etchemendy will appoint a search committee to begin the process of finding Saloner's successor.