Thursday, June 17, 2004

Fetch the tar and feathers

This year of stunted stock market growth seems to have ignited the smoldering anger of investors and employees. Many news articles mention boards having increased their paychecks and bonusses, while simultaneously slashing corporate costs and laying off thousands of employees.
Is the behavior of CxO's "the ugly side of capitalism" as some people claim and is it about time we "fetch the tar and feathers", or are investors just venting off their emotions after a period of below-average stock returns? Should we place our bets on encouraging ethical behavior or will new accounting rules and stronger governance standards lead company executives and directors to "reconsider executive compensation programs"? Or should we be careful in allowing these kind of things to influence the fundaments of our market economy?