Dive Brief:

• Freight railroad operator Norfolk Southern appointed Jason Zampi to serve as its permanent CFO, treasurer and executive vice president effective immediately, the company said in a release Tuesday. On Sept. 11, Zampi, a 13-year veteran of the company, stepped up to become acting CFO and replace then CFO Mark George, who was in turn promoted to replace CEO Alan Shaw, the company said.
• Zampi’s appointment is part of a broader leadership shakeup stemming from the Atlanta-based company’s abrupt decision about two weeks ago to fire Shaw “for cause,” citing preliminary findings of an investigation that determined Shaw “violated company policies by engaging in a consensual relationship with the company’s chief legal officer,” Nabanita Nag, who was also terminated, according to a company release at the time. 
• On Tuesday the company also named Jason Morris — who joined the Atlanta-based company’s legal department in 2010 and was appointed as vice president law in 2022 — to be its chief legal officer and corporate secretary, also effective immediately.

Dive Insight:

The C-suite scandal that led to Shaw’s swift departure comes as the company has also been grappling with fallout from the calamitous derailment of a train carrying hazardous materials in East Palestine, Ohio last year. 

The incident drew regulatory scrutiny and resulted in the release of dangerous chemicals such as vinyl chloride, an evacuation order, and residents experiencing burning eyes and headaches, The Wall Street Journal reported. In May, the U.S. Environmental Protection Agency and Department of Justice announced a settlement valued at more than $310 million that required the railroad to pay for past and future cleanup, improved rail safety, and other costs.

Because Norfolk carries freight for chemical shippers, it faces risks from hazardous material spills, Morningstar Senior Equity Analyst Matthew Young wrote in a Sept. 12 note. “Along these lines, although Norfolk has insurance coverage, the 2023 derailment in East Palestine, Ohio, still holds the potential for significant future liabilities in terms of fines and lawsuits,” he wrote. Young also asserted that it would have been preferred for the company to pick a rail industry veteran to take over the CEO role but said George, who was previously CFO at Otis Elevator Company, was a “seasoned business leader.” 

In choosing Zampi, 49, as Norfolk Southern’s finance chief, the company cited his more than 28 years of finance accounting experience, his experience in key roles in forecasting, budgeting and corporate accounting, and his dependability. A certified public accountant, he holds a Bachelor of Science in Accounting from Pennsylvania State University, and prior to joining Norfolk Southern he was a senior manager with the Big Four accounting firm KPMG. 

Since joining the company in 2011, Zampi has held various roles, including assistant vice president, corporate accounting from 2016 to 2018, vice president and controller from 2018 to 2020, vice president of financial planning and analysis from 2020 to 2024 and vice president finance and treasurer of the company starting in August.  

"Jason is someone our entire executive team and board count on to provide critical financial insights that increase our success," said Norfolk Southern CEO George in a statement included in the release. "His deep industry knowledge, coupled with his strategic leadership and commitment to operational excellence, makes him an invaluable asset as we continue to position Norfolk Southern for long-term growth."

The board approved an annual base salary of $600,000 for Zampi, with an annual incentive opportunity of 150% of the salary, each of which will be prorated for the days he works as CFO this year, according to a Tuesday securities filing. He was also given a long-term incentive award with a grant date fair market value of $554,200 comprised of restricted stock units, performance share units and stock options. 

In comparison, last year his predecessor George’s compensation totaled $3.4 million, including $1.8 million in stock awards, $675,000 in salary, and $599,848 in option awards, according to a March 20 proxy filing. 

For his part Morris, as chief legal officer, will oversee the company’s legal, government relations, corporate secretary and compliance departments, according to the release. In addition to being a lawyer, he also has a background in public service, having served as legislative director in the U.S. House or Representatives and as a logistics readiness officer in the Virginia Air National Guard.