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Why
companies need owners
"What this company needs is an owner," declared Sam Zell, after completing
the $8.2 billion deal that put him in charge of the Tribune Co., which owns
newspapers including the Chicago Tribune, the Los Angeles Times and Newsday.
"It needs someone who accepts the responsibility for what this company
does." |
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How
true. Whether Zell, as a committed owner, will help save newspapers is an
open question. But the fact that the real estate billionaire has a lot of
skin in the game - $315 million of his money, plus the right to buy up to 40
percent of the company down the line - means that he, and his people, will
be very focused on getting the job done.
All companies need owners who are engaged, committed and, ideally, thinking
about long term. So argues Robert A.G. Monks, the shareholder activist,
author, lawyer, entrepreneur and corporate director in a new book, called "Corpocracy:
How CEOs and the Business Roundtable Hijacked the World's Greatest Wealth
Machine - and How to Get It Back" (Wiley, 2007, $29.95).
Corporacy is not a pretty word, but this is not a pretty story. Shareholders
of most Fortune 500 companies are so dispersed and
unorganized and
disempowered that CEOs are accountable to no one but themselves, Monks
argues.
"A venture with one million shareholders ultimately has no real owner," he
says.
The result, he argues, are the by-now familiar horror stories about
excessive CEO pay, lavish severance payments for failed leaders, rejiggering
of stock options and the like.
Read more from the source
This article is suggested by Anand Mann |
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