CEOs don't have the easiest jobs in the world. Being responsible for leading an organization with needy employees, unreasonable suppliers, and impatient shareholders who all demand perfection can certainly be a daunting task. It ain't for the faint of heart.
While back in the good 'ol dot-com boom days, CEOs got more attention than rock stars just for showing up to work wearing a clean, pressed suit, times have indeed changed. The images of Enron and WorldCom executives being carted away in handcuffs undoubtedly changed how investors view the corporate chief.
With eye-popping pay packages being the norm now, for CEOs it's either produce the numbers or make room for the next candidate. Good example: Shareholders didn't show any mercy for Merrill Lynch
Alas, some companies seem to need a little reminding about the blunders of their CEOs. A bobble here and there is one thing, but these CEOs have gone beyond corporate boneheadedness and should be shown the door soon. Let's take a look.
Candidate No. 1
Angelo Mozilo -- Countrywide Financial
Sure, the mortgage market is facing unprecedented rough times, but this guy has pushed the limits. Mozilo didn't seem to realize that the blatant real estate boom would ever come to an end, failing to put safeguards in place and leaving the nation's largest mortgage company struggling to tread water. As Warren Buffett has quipped, "When the tide goes out, you find out who has been swimming naked." Mozilo has been caught skinny-dipping.
While a total demise of Countrywide seems unlikely, shareholders deserve a more ethically responsible leader during these tough times.
Contestant No. 2
James Tobin -- Boston Scientific
At least he's honest. Before the monumental purchase of Guidant last year, Tobin warned the board of directors, "We're going to pay a lot of money for Guidant, and then we're going to wake up and discover we have a company with a lot of problems. And everyone will be wringing their hands and crying: 'My God, what have these guys done?' "
Talk about creating your own destiny. The bidding war Tobin engaged in with Johnson & Johnson
Conundrum No. 3
John Mackey -- Whole Foods
Buffett said it best. "Your reputation takes a lifetime to create, and five minutes to destroy."
Mackey did an incredible job growing Whole Foods into a gourmet health-food behemoth, but his being caught last summer promoting his company's success on Yahoo! message boards while trashing competitor Wild Oats -- a company Whole Foods was in the process of purchasing -- perhaps gives a new meaning to the word "unethical."
Sure, his childish acts were in the name of shareholder success, but it also proved how shady this guy can be. What's next? Incognito appearances at a competitor's shareholder meetings?
I'll pass, thanks
Don't underestimate how incredibly important it is to have an honest and competent CEO running your investments. Even the greatest companies in the world can be taken down by overzealous and incapable leaders who don't put you, the shareholder, first. Remember, you're an owner of the companies you invest in. Don't settle for anything less than the best.
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