STOCKHOLM (Reuters) - The Nobel Foundation could drop the Swedish Academy from awarding its prestigious annual literature prize if the Academy does not make further changes in the wake of a recent sex scandal, the head of the foundation told Reuters on Friday.

Nobel Foundation CEO Lars Heikensten pose for a picture at the foundation's headquarters in Stockholm, Sweden September 28, 2018. REUTERS/Esha Vaish

“If things continue in this way, and if they don’t manage to regain legitimacy, then we might be forced to take drastic steps,” Lars Heikensten said.

“One of those steps could be asking permission to have some other organization being responsible for the prize.”

(Graphic: Nobel Laureates interactive - tmsnrt.rs/2y6ATVW)

The Academy is working to rebuild its reputation after a sex scandal involving the husband of one its members. The incident prompted some of the Academy’s 18 members to quit.

It also forced the Academy to postpone the awarding of the 2018 Nobel Prize for Literature.

The husband, Jean-Claude Arnault, has repeatedly denied any wrong-doing.

Heikensten said the Academy had taken its first positive step by agreeing on a reinterpretation of its bylaws to allow it to deal with issues including the need to hire several new members and remove others.

“They need to look at the composition of the Nobel committee, those who are most involved with the prize, so that the committee consists of people who are competent and have not been involved in a negative way with what has happened,” he said.

He expressed reservations when asked if enough had been done since the scandal.

“I think (agreeing on the bylaws) was a step in the right direction, but they still have several steps to take. So things don’t look that good,” Heikensten said.

In addition to members resigning, several others, including Arnault’s wife, are not taking part in the Academy’s work as a consequence of the row.

Heikensten said he believed it would be good if more members of the Academy resigned, but he declined to elaborate.

In a normal year, the Academy would be set to begin work to select the 2019 prize winner, however this year’s troubles have put that process on ice.

Heikensten said that if the Academy could not resolve its problems soon, it would not be allowed to hand out the 2019 literature prize.

“We certainly hope that the Swedish Academy will be able to give out the (literature) prize in 2019 and we’re working as hard as we can on that,” he said.

“But if things are not dealt with properly reasonably soon... most likely, in that case, there will be a postponement again but that would be very unfortunate.”