Tuesday, January 02, 2007

Out of the Closet

A version of this appeared in Investor Relations Magazine, December 2006 issue

Notes From The Throne,
Ian Williams brings the secrets of leadership out of the closet.

Five hundred years ago, Sir John Harrington, said 'Treason doth rarely prosper…for if it prosper, none dare call it treason.' He could almost have epitomized brown-nosing since at one point he won back the favor of Good Queen Bess by introducing her to his invention, the water closet.

With the oleaginous toadyism that lubricates most organizations, there indeed are few who care to challenge whoever is on the throne, whether it is the President of the US or the CEO of a major corporation. But they will all be quick to cheer whoever stabs them in the back to take their place.

So, despite all the respectful prose about them while in office, how can modern CEO's ensure their place in history when they leave, let alone when they've gone to that big boardroom in the sky?

A slave crowded into the chariot of Roman Commanders during their Triumphal parades whispering into their ears, 'Remember, you are only mortal.' The slave who drew the short straw for this assignment probably ended up in the arena shortly after, since the ego of Roman commanders exceeded even that of modern captains of industry.

Although modern executives can send hundreds of thousands to the unemployment lines to the cheers of Wall St, those generals in the Forum were serious, they could really execute, and sent similar numbers to their messy deaths without a twitch of their togas.

For all these centuries, Rome was considered the apogee of civilization, and its leaders heroes for all ages. Yet the Empire practiced brutal military aggression against its neighbors. Resistance provoked Roman orators into paroxysms of patriotic rhetoric, about the savagery of these natives resisting civilization as the invading legions killed and enslaved their people – or kept them for mass crucifixions or to feed the lions in the Coliseum.

Two millennia later, official history remembers the Emperor Trajan as one of the best of the Caesars. But his column in Rome shows his troops sacking cities and carrying away wagonloads of loot from his unprovoked annexation of what is now Romania. Julius Caesar, who ethnically cleansed much of Gaul, is a household name.

In contrast, most of the super-CEOs that now haunt the business pages will totally disappear from consciousness within a few years of their retirement. So how can a modern day Wall St Lord of the Universe preserve his or her name for posterity?

Well obviously, many of them pass the first test for posthumous fame – which by imperial precedent is tendency to preen themselves on doing harm to others, while enriching themselves.

On the other hand, can you imagine a Ken Lay Column, for example, erected in the centre of Houston, showing his success in looting companies, destroying livelihoods, and bribing legislators? It would not really cut the historical mustard.

My answer is a reform of corporate governance: every board should have a compulsory cynic on board to cut executives down to size. I am prepared to offer my services for a modest fee, with (preferably not backdated) options, tied to how much I can reduce executive compensation.

And I would also advise them that the secret of immortality is ostentatious philanthropy.
Ford, Rockefeller, Carnegie, were unscrupulous strikebreaking financial finaglers, but giving away their wealth to eponymous foundations has preserved their names for a century or so.

Of current magnates, who will remember a decade hence the chainsaw gangs who have vivisected thriving enterprises in search of bloated options? I would hazard that one name likely to survive is Bill Gates. If he had just been the CEO of Microsoft, his memory would have been flushed down one of Sir John Harrington's inventions like a crashing Windows system. But I would predict that thanks to his endowment, the Gates Foundation will be around when people will hazard that 'Microsoft' is a term for a detumescent organ.

Which, like Roman history, is unfair really. Warren Buffet modestly left his fortune to a foundation named after someone else. Now that should make the history books.

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