Merit is one of the enduring standards we are all taught from the moment we start school. If you get good grades, you advance. If you perform well, you advance. What, then, are we supposed to think about the young children or college-age students who read about this, courtesy of The Times Gretchen Morgenson (who may be the only reporter in the traditional media who consistently calls the business world on the carpet for unethical and immoral conduct):
YOU might think that board members overseeing businesses that cratered in the credit crisis would be disqualified from serving as directors at other public companies.
You would, however, be wrong.
Directors who were supposedly minding the store as disaster struck at companies like Countrywide Financial, Washington Mutual or Fannie Mae have not all been banished from other boardrooms. In many cases, directors just seem to skate away from company woes that occurred on their watch.
To some investors, this is an example of the refusal of those involved in the debacle to accept responsibility for it. Whether you are talking about top executives loading up on leverage, regulators who slept while companies took on titanic risks or mortgage lenders that made thousands of dubious loans, few in this crowd have acknowledged culpability. Taxpayers and shareholders, meanwhile, who had nothing to do with the problems, are left holding the bag.
“None of these directors have stood up and said, ‘We made a mistake here by not calling management to account,’ ” said Paul Hodgson, senior research associate at the Corporate Library, a corporate governance research firm. “They have certainly avoided the limelight as far as blame is concerned.”
Moreover, they continue to get work as directors at other companies. [emphasis added]
So, the people who have suffered from the credit crisis have NOT BEEN the people who created the crisis. Rather, the only people who bear the brunt are those who were essentially innocent bystanders–the average person who is now unemployed in the greatest employment crisis in generations.
Merit is irrelevant in the business world. It’s all about access and who you know–either in the board room or in Washington. This is what people are rightly furious about.