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Time was when a good CEO or senior manager was focussed on making his company great. Great technology, great products, a leading reputation in the industry. OK, profits were nice too, growth was good and solvency was essential – but financials were not the primary concern.
Now there’s the prospect of selling out your company to a PE company and collecting a fat wodge for yourself.
Michel Mayer, CEO of Freescale, is said to have walked away with North of $20 million when he sold out Freescale, disastrously, to Blackstone.
Now we’ve got Infineon flirting with the idea of selling its wireless business. It’s one of the world’s greatest wireless businesses, with the accolade of having its baseband in the iPhone, and it had sales of $1 billion last year.
But the Infineon brass scents money. Pride of ownership comes a long way after wonga.
Any guilt about selling out your people comes a long way after personal enrichment.
It’s understandable.
It’s human nature.
But it’s sad.
Peter Drucker was the godfather of management theory. His thoughts fell like pearls upon the ground before his legions of followers.
He could do no wrong.
Until one time he preached that company management salaries should have an upper mutliple limit of the lowest paid company worker. He suggested 20x.
After that – he wasn’t quite so popular in some circles.
Funny that?
IMHO, Brian, that’s a brilliant idea.
In my humble opinion, it should be illegal for company directors to gain financially from the sale of their company. This would mean that companies would only be sold if the directors believed that would be better for the company.
I totally agree. It is time the large institutional shareholders held management to account far more strictly. Look at the Prudential/AIG fiasco – cost $400m for nothing and the management team is still in place, not dangling from trees.
Madness.