walleke

Economic Donkeys

Many of the problems are cause by a failure of corporate governance. Too often the CEO and chairman of the board of directors are one and the same person. The board is appointed and controlled by management. I believe it is contrary to fiducial responcibility to allow any member of management on the board.

A board of directors should be adversarial to management. An adversarial board would not permit excessive pay - endemic across industries not just finance - and would not permit excessive risk. They would be our best regulators.