Working Wounded Blog: Executive Humble Pie
July 12, 2006 — -- Remember when President Reagan was shot and Al Haig famously burst into the White House and said that he was in charge? OK, it might not have been as over the top as Howard Dean's scream, but Haig did become the poster boy for an Era of Executive Testosterone Overload. An era that seems to have come to an end. Finally.
Calling the most recent generation of head honchos "executives-in-charge" doesn't sum it up adequately. Executive "rock stars" is more like it. For much of the last decade, the line between CEO and celebrity blurred. Some weeks there seemed to be more CEOs on magazine covers than supermodels. And gossip columns were full of tidbits on their lavish lifestyles.
In the future, if they try to carbon date the exact moment when the Era of the Executive ended, it remarkably didn't involve a perp walk with a shamed executive being led away in handcuffs, though we've certainly seen that image a few times in recent years.
No, this era ended with Hamdan vs. Rumsfeld. In this recently decided Supreme Court case, the justices held that the president of the United States, the ultimate executive, is not beyond the law and must follow certain legal principles and the Geneva Conventions -- even in wartime
This case is definitely the icing for the end of the unquestioned executive, but the cake has been rising for a long time. Enron, WorldCom, Tyco executives learned the hard way -- via hard time -- that Leona Helmsly was wrong. It's not just the little people who have to pay taxes. The rules are for all of us.
Consequences. What a concept.
Like it or not, we all need to get ready for more and more restrictions and rules surrounding executive behavior. Sarbanes-Oxley (SOX for short) is just the start. The main reason more regulations and restrictions will be right around the corner? People are tired. They're tired of guys (yes, mostly guys) who earn millions of dollars in salary, with a boat load of options (backdated, of course) who still manage to justify having employees not covered by health insurance.
Just like the labor union movement in the first part of last century, executives once again moan about a logical response to their greed run amok. What is always overlooked by executives and the often toothless business press is the wretched excess that preceded unions, SOX, etc. SOX is necessary, because executives couldn't police themselves.
Sure, there are good guys and gals out there in the executive suites. Warren Buffett immediately leaps to mind. For him to give a gift approximately five times the size of Carnegie and Ford is indeed worthy of sainthood. For that alone, I promise to take back two-thirds of the Nebraska jokes I've made through the years. But it's not good enough to give back some of the gains. The public is demanding that executives do the right thing from the very start. And I don't think that's too much to ask. Even from the oil industry.
Enjoy your slice of humble pie, Mr. Corporate Executive. You've earned it.
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