Saturday, March 12, 2005

You get the CEOs you deserve

After the world was shocked by Enron, Worldcomm and other spectacular cases for corporate crooks, America's corporation pledged to clean up their act. Although we were told those few bad apples were the exception rather than the rule, new accounting rules were put in place. Just in case, you know.

I applaud the new rules. But as long as the business sector chooses to raise crooks, liars and convicted felons to the rank of heroes or victims, "corporate responsibility" and "financial sector reform" will stay empty PR buzzworks.

Junk-bond king and U.S. prison system veteran Michael Milken is at large again and his corporate friends trust him with tens of millions in charity money. Martha Stewart got plenty of sympathy both from brokers and the public for doing "what everyone else is doing."

And Ottawa Citizen's financial columnist Mark Sutcliffe fears the ethical standards we're asking of CEOs are too high (registration required for column).

"Board members are now cracking down at the first sign of trouble, largely to protect the company - and themselves - from liability. One of the mechanisms of their newfound Puritanism is the employee whistleblower." Commenting Boeing's dismissal of its new CEO for having an affair with a company executive, he points out "What used to be none of the company's business now might be a firing offence."

Quite right. It's about time shareholders make it their business to know what's going on in the company they own.

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