By John Donovan
I wonder if Paddy was thinking of Shell when he published this on this Facebook page?
The grotesquely high “compensation packages” of the Directors of the likes of HSBC as well as being morally repugnant are also bad for business. The rewards for making it to the top are so obscene that ladder climbers will do anything to make it. So every decision they take is driven by their own ambition and their need to kowtow to those who might appoint them to these golden jobs. This is a brake on creativity and innovation and on long-term thinking.
The temptation to do something to improve short-term “KeyPerformance Indicators” (KPI), like revenue expenditure, is irresistible. Slashed budgets rarely deliver long term growth. Stopping planned Capital Expenditure boosts the cash flow KPI at the cost of surrendering long term advantage. Slash and run is good for only one thing – making the ambitious executive look good so that he can feather his nest.
The odd correlation that struck me about the current scandal arising from the period that Stephen Green (now Lord Green) was CEO of HSBC and the time when Sir Philip Watts was Shell Chairman when it became engulfed in a huge financial scandal, is that both are ordained priests!
Something for psychologists to chew over.
Sir Philip, who was forced to resign as Royal Dutch Shell Group Chairman, reportedly received a compensation/pension package worth $18.5 million.
COMMENT FROM AN OLD EP HAND
John, you forgot to mention Justin Welby, the head honcho of the anglican church! Here from wikipedia: Welby worked for 11 years in the oil industry, five of them for the French oil company Elf Aquitaine based in Paris. In 1984 he became treasurer of the oil exploration group Enterprise Oil PLC in London, where he was mainly concerned with West African and North Sea oil projects. He retired from his executive position in 1989 and said that he sensed a calling from God to be ordained. He has worked for ELF (not the most honest company in the world) and was handling the treasury for Enterprise. He must have seen so many bad things he is now repenting I assume? When will we see lord Browne ordained?