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"Breach of Fiduciary Duty" sounds like one of those things that you're supposed to do, but which is almost impossible to prove (after all you just have to claim
by javajosh 7y ago
"Breach of Fiduciary Duty" sounds like one of those things that you're supposed to do, but which is almost impossible to prove (after all you just have to claim "I thought it was a good idea" and you're covered), and so is basically never enforced. It's the kind of rule that ethical, good CEOs worry about, and the kind of rule successful CEOs don't waste energy on.
BTW, I notice that commenters often have wildly different views of what rules mean. To some, they mean something intrinsically, and it's the players duty to understand and abide by them. To others, rules mean nothing unless they are enforced, and even then you have tons of wiggle room (roughly proportional to the money you spend on your defense). (And these days there's a vocal third crowd that says the government shouldn't enforce rules against businesses of a certain size "because it makes us vulnerable".)
- ineedasername 7y agoYeah, I imagine it's hard to prove when the CEO just games the company's performance metrics to improve their compensation package, but self-dealing makes things at least a little bit clearer. I wouldn't be surprised if there's at least one activist investor lined up with plans to take advantage of the situation and start a shareholder lawsuit. As for a good CEO vs. successful CEO, I guess I don't actually view the later as "successful", because their actions either hurt the company or at least hindered its success. I look at the failure of Sears, abetted by a self-dealing CEO, as a prime example of failure in this area.
- paulcole 7y agoAre there any examples of significant fines/penalties to notable CEOs for "Breach of Fiduciary Duty"?