Royal Bank of Canada fired CFO Nadine Ahn on Friday, after the bank said it found evidence she was in an undisclosed personal relationship with another employee that led to preferential treatment, including a promotion and compensation increases.
RBC terminated that employee Friday, as well. Sources speaking to The Globe and Mail identified him as Ken Mason, a vice president and head of capital and term funding who is a 23-year veteran at RBC.
The bank named Katherine Gibson, its senior vice president of finance and controller, as interim CFO while it searches for a permanent successor. Gibson joined RBC in 2002.
RBC was alerted to the matter March 11, when an employee used a confidential internal channel — known as “Speak Up” — to give details of the issue to the bank, three sources told The Globe and Mail.
“RBC became aware of the allegations on March 11 and immediately launched an investigation,” bank spokesperson Gillian McArdle told the publication. “We engaged outside legal counsel to investigate. Based on a review of the evidence, we terminated employment for both individuals on April 5.”
Rumors had swirled for some time about the nature of Ahn and Mason’s relationship, four sources told The Globe and Mail. But scrutiny intensified when the bank announced a reshuffle within the treasury division in October that elevated Mason above long-term peers, five sources told the publication.
As CFO, Ahn had control over compensation and promotions in the treasury division, the sources said. As senior leaders left the division over time, Ahn used her position to expand Mason’s role in ways that led to pay increases, two sources said.
Ahn had been seen as a potential successor to RBC CEO Dave McKay, two sources said. McKay’s tenure atop Canada’s largest bank has stretched to 10 years.
Ahn joined RBC in 2002 and has spent much of her career in the bank’s treasury division. She did, however, spend two years in capital markets from 2014 to 2016, according to her LinkedIn profile. Prior to becoming CFO in 2021, she served as RBC’s head of investor relations, which gave her a public-facing position and the ability to develop relationships with external analysts and portfolio managers.
Making the leap from that — a senior vice president-level post — to CFO meant she bypassed the executive vice president level entirely, The Globe and Mail reported.
The bank’s board was considering moving her in the near future to a role overseeing a revenue-generating line of business, often seen as a testing ground for CEO candidates, one of the publication’s sources said.
Being a woman in the running had made her a trailblazer, too. She was the only female CFO among the six largest Canadian banks when she was named to the role, Bloomberg reported. Since that time, Marie Chantal Gingras has been named CFO at National Bank of Canada.
Ahn might not receive severance, if RBC holds true to what it stated in its annual proxy circular, because she was terminated for cause. She also may have to forfeit other bonus awards.
The bank boosted Ahn’s compensation by 25% in 2023 — to C$4.07 million ($3 million). That breaks down to a C$650,000 salary and C$3.42 million in bonuses and stock awards, according to the circular, in which the bank highlighted that she oversaw a nearly 2 percentage-point boost in RBC’s common equity tier 1 ratio.
She “exercised a disciplined approach to resource management and stewardship of enterprise efficiency and cost containment, maintaining a strong controls and governance environment as well as continuing to support the enhancement of ESG disclosures,” the bank said.
The Globe and Mail could not reach Ahn or Mason for comment.
