Does Away co-founder Steph Korey really deserve to be CEO again?

This CEO sure came back around fast.
This CEO sure came back around fast.
Image: Reuters/Anindito Mukherjee
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Away co-founder Steph Korey is back as co-CEO at the direct-to-consumer luggage company, only a month after stepping down from the role in a blaze of bad PR over her management tactics and behavior toward Away employees.

Can this possibly end well?

In an exposé in The Verge in early December, former Away employees accused Korey of verbally and emotionally abusive behavior. In the aftermath, the company announced that Stuart Haselden, Lululemon’s chief operating officer, would take over as CEO, while Korey would become Away’s executive chairman. At the time, it seemed likely that Korey would stay out of the spotlight while Away—most recently valued at $1.4 billion—worked to undo the damage to its reputation.

But now Korey says that the change was never meant to signify that she was taking a real step back from the company she helped start. Rather, she tells the New York Times, she expected to maintain most of her job responsibilities, albeit under a different job title. She and the board have since concluded that the decision for her to step down as CEO was too hasty, and that she should share the role with Haselden.

Whether this will turn out to be a smart move for Away depends on the answers to a few key questions.

Question 1: Will Korey manage the Away team differently than before?

Korey purportedly set the expectation that Away’s customer-service staff work nights, weekends, and holidays, without overtime pay. (The company eventually started paying overtime.) In one incident described in The Verge’s article, Korey reportedly told customer-service representatives that she would not approve any paid time off or work-from-home requests until they succeeded in passing a new spot-check system, adding in a Slack message, “I hope everyone in this group appreciates the thoughtfulness I’ve put into this career development opportunity.”

The Verge also reported that she fired six employees who had been participating in an employee Slack channel for LGBTQ staff and people of color, accusing them of being discriminatory. (The former employees say she used terms like “racist” and “hate speech” while letting them go; Korey disputes that claim.)

Initially, Korey appeared contrite over the allegations. She apologized in a statement posted to Twitter on Dec. 6, saying her actions were “wrong, plain and simple.” She acknowledged she had “expressed myself in ways that that hurt the team” and said she was “appalled and embarrassed” in reading over her Slack messages. She also said she had been working with an executive coach to improve her behavior.

But in her Jan. 13 interview with the New York Times, Korey moved from defense to offense, criticizing the Verge’s reporting rather than focusing on her own actions. “Frankly, we let some inaccurate reporting influence the timeline of a transition plan that we had,” Korey told the Times’ Andrew Ross Sorkin.

While the company now says it disputes the Verge’s reporting, neither Away nor Korey have specified what aspects of the story they find inaccurate. It’s also noteworthy that Korey is walking back the extent of her apology. As she told the Times, “When I think back on ways I’ve phrased feedback, there have been times where the word choice isn’t as thoughtful as it should have been, or the way it was framed actually wasn’t as constructive as it could have been.”

This is a far lighter self-rebuke than her previous language. Indeed, Korey’s interview with the Times, as well as the memo she sent to Away staffers on the same day, avoids any admission that she mistreated or hurt employees. The memo only acknowledges the allegations against Korey insofar as calling out unspecified “deliberate lies and distortions” in the Verge’s reporting “that unleashed a social media mob.”

As for any intention to operate differently, Korey wrote in the memo that “we, like any company, can always be improving ourselves through building an even stronger culture.” Does she mean this as though Away’s culture problems are no more serious than those found anywhere else?

Since Away is weighing legal action against The Verge—the luggage company has retained the defamation law firm Clare Locke LLP—there may be legal reasons for Korey to avoid admissions of wrongdoing. Still, the nature of her comeback announcement gives little reason for Away staffers or the public to think that she plans on doing things differently now.

Question 2: Was Korey’s management style actually a problem in the first place?

In all fairness, there likely is a gendered component to the backlash against Korey. Steve Jobs was known to be verbally abusive to his employees, but was nonetheless widely lauded as a genius essential to Apple’s success. Jeff Bezos comes across as a jerk in journalist Brad Stone’s The Everything Store, responding to one engineer’s presentation with “Why are you wasting my life?” and telling an employee giving him pushback, “Do I need to go down and get the certificate that says I’m CEO of the company to get you to stop challenging me on this?” Yet his job security remains intact.

In a culture where founders and CEOs act as if the pursuit of excellence simply demands that they treat their workers with active hostility, it’s no surprise that a number of venture capitalists expressed their support for Korey in the aftermath of the Verge article, defending her behavior as typical of startup founders pushing for results. The messages in which she disparages employees do seem pretty typical in that context. But this isn’t behavior anyone should be rushing to defend.

As Fast Company’s Jason Shen noted in a December piece about the scandal at Away, “The definition of an acceptable work environment is changing. What might have been considered normal 30 years ago, such as casual sexism, racism, ableism, have become far more scrutinized—and that’s a good thing. Tech employees should expect to work somewhere free of verbal abuse, emotional manipulation, or extended unpaid overtime.”

The fact that mistreating employees is standard practice among many CEOs doesn’t mean that Korey ought to be off the hook; it means that more business leaders should be facing the same levels of scrutiny.

Question 3: Can Away be transparent about its norms and expectations?

It’s worth noting that holding CEOs and managers to a higher standard doesn’t mean that everyone has to start acting the exact same way. As Josh Barro suggests in New York Magazine’s Intelligencer, Away’s culture may be toxic for some workers and perfectly fine for others.

Indeed, different people have different thresholds when it comes to communication; what one person experiences as rude, another may experience as simply direct. It’s within companies’ purview to set cultural norms that will appeal to a specific subset of people. Barro points to Bridgewater Associates’ emphasis on “radical transparency,” a feedback style that certainly has its devotees, though it sends others running for the hills. Zappo’s radical experiment with holacracy was similarly divisive among staffers.

And so if Away wants to, say, perpetuate a culture where conflicts get hashed out in public Slack channels, it should feel free to do that. But it would be wise, then, to be upfront about that during the hiring and recruitment process, and take steps to create a culture where employees feel empowered to go toe-to-toe with the CEO over Slack without fear of being penalized for speaking out.

A system where the CEO berates overworked and overwhelmed employees for problems arising from systemic issues, rather than their own performance, isn’t the result of a unique startup culture. It’s just a bad place to work.