Financial Penalties for BIDMC CEO Paul Levy Don't Undo Damage

Right now, the board is discussing whether to require Levy to repay the hospital for a severance package that was given to the woman when she left her job last year at Beth Israel Deaconess-Needham, as well as withholding bonus money from him this year.

Well, it's a start.

As a CEO, you make enemies. It's unavoidable. People who feel marginalized by your power—no matter how lightly it's wielded—look for ways to exact little revenges. In this case, one of those people used an anonymous letter to do so. Your only recourse is your good faith and your honesty. If those are compromised, your leadership position can quickly become untenable.

In this particular case, I'm not sure whether Paul Levy can continue his run of success at the hospital. The damage goes well beyond the limits of the person, of course, because he's the leader of one of the most important healthcare organizations in the country. How does one calculate the losses that Beth Israel faces in terms of developing teamwork among its clinicians and staff? How does it calculate the perceived loss of political capital from Levy's personal missteps? What happens the next time its CEO is confronted with a tough decision about layoffs? Nobody knows, but we're going to find out.

Like attempting to place a dollar value on a reputation, those losses are incalculable, and paying them back is next to impossible.

Yet they exist.