4 ms·

I have a question that I know is really stupid, but I'm asking sincerely: why is it permitted for the company to do this? Paying any person a windfall after sex

I have a question that I know is really stupid, but I'm asking sincerely: why is it permitted for the company to do this? Paying any person a windfall after sexual indiscretions seems like it violates their responsibility to the shareholders, especially when it's $90 million (wow!). Why is this type of payout allowed by the SEC or the corporate governance structure?

Stryder 8y ago
It's not stupid. Think about large families with inherent power dynamics- everyone's either been in or knows at least one. It's just a human thing. We know what's right and wrong, but acting according to what we /know/ is a lot harder said than done when human nature is factored in. Now make the assumption that a group of human beings were doing the right things at the right time in the right place to become mega rich, and then apply the same rules. People aren't terribly different from one another on the fundamental level- the only different things are circumstances which determine 1) the number of restrictions, and conversely 2) the number of privileges. The only valuable question is how to minimize this human dynamic as the size of the group grows, because leaving a 5-person group behind to find something different is a lot easier and a lot less consequential than leaving a 5000-person group.
sjg007 8y ago
The board signed off on it and the Brin, Page and Schmidt have class A shares which are controlling. So if they vote for something it is automatically approved by a majority of shareholders.
Sacho 8y ago
Rubin wasn't fired, he resigned. Google seem to have paid out his severance package. It's possible they could have fired him, citing sexual misconduct; then they would most likely have to content with a lawsuit by him for wrongful firing, and all the details would have to leak out. There are a myriad of reasons why Google would not want this: 1) They did not have enough evidence to fight in court - the article claims Google thought the accusations were "credible", but not necessarily proven. This could easily be a disaster for Google which can easily go away with some money and a resignation. 2) Even if they had enough evidence, the damage to their public image from this would be substantial, which could be costlier than the "payout". 3) The majority of controlling shareholders(Brin, Page, Schmidt) want to remain on good terms with Rubin and are willing to sacrifice the money to do so, thus fulfilling the responsibility to the shareholders angle. How would you ban this type of behavior?

Stryder 8y ago

It's not stupid. Think about large families with inherent power dynamics- everyone's either been in or knows at least one. It's just a human thing. We know what's right and wrong, but acting according to what we /know/ is a lot harder said than done when human nature is factored in. Now make the assumption that a group of human beings were doing the right things at the right time in the right place to become mega rich, and then apply the same rules. People aren't terribly different from one another on the fundamental level- the only different things are circumstances which determine 1) the number of restrictions, and conversely 2) the number of privileges. The only valuable question is how to minimize this human dynamic as the size of the group grows, because leaving a 5-person group behind to find something different is a lot easier and a lot less consequential than leaving a 5000-person group.

sjg007 8y ago

The board signed off on it and the Brin, Page and Schmidt have class A shares which are controlling. So if they vote for something it is automatically approved by a majority of shareholders.

Sacho 8y ago

Rubin wasn't fired, he resigned. Google seem to have paid out his severance package. It's possible they could have fired him, citing sexual misconduct; then they would most likely have to content with a lawsuit by him for wrongful firing, and all the details would have to leak out. There are a myriad of reasons why Google would not want this: 1) They did not have enough evidence to fight in court - the article claims Google thought the accusations were "credible", but not necessarily proven. This could easily be a disaster for Google which can easily go away with some money and a resignation. 2) Even if they had enough evidence, the damage to their public image from this would be substantial, which could be costlier than the "payout". 3) The majority of controlling shareholders(Brin, Page, Schmidt) want to remain on good terms with Rubin and are willing to sacrifice the money to do so, thus fulfilling the responsibility to the shareholders angle. How would you ban this type of behavior?