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| Oh, look what I've found on the ground. |
Here's an image for you: That vulture is stalking that kid, who is on his last, spindly legs.
So when a board of directors, a bunch of vultures, decides to swoop in and scarf up a pile of money they have fund in the accounts of the company which is paying their stipends, think of this bird, and this kid.
Market Basket had a pile of money--about $500 million dollars, and the board of directors decided they would simply grab it. Arthur T had other ideas: Use the money to pay employees, to lower prices for consumers, but the board members wanted it for themselves. It was a case of "stakeholder" capitalism vs, you name it--"Market" capitalism or "Wall Street" capitalism or "Vulture" capitalism. It's all the same. The way Wall Street works is a "board of directors" governs the corporation and they meet in some private room, far from public view and decide how much to pay themselves and as long as the stock price of the company stays up, nobody finds out.
This practice is legalized robbery. Robber barons, feasting on the defenseless.
So when the departing CFO or CEO or provost gets a million dollars a year for life from the company, or when the board of directors votes to pay board members $500,000 a year for all their hard work, there is nobody there to dissent, to raise a hand and say, "Whoa! Who does this money rightfully belong to."
Nice work, if you can get it.
It's all just curled up there, in front of you.
Mad Dog,
ReplyDeleteA most wonderful outcome for Market Basket last night!! The vultures did not win this time..let's just hope Arthur T, stays true and loyal to the employees who stuck by him despite significant personal and financial hardship and sacrifice-I think he will. ..Does Arthur S. really believe he got the better part of the deal when he got a billion dollars and all Arthur T. got was a model company and the love and devotion of thousands of employees. I'm sure they'll be studying Market Basket in every business school in the country and when they do they should be asking every student "Who would you rather be- Arthur S.or Arthur T?"
Maud
Ms. Maud,
ReplyDeleteFriends who work for Market Basket were delirious today. Hope their euphoria is justified.
This continues to be reported as a family feud. The report I heard on NPR had some Harvard professor whose "research" is all about family owned companies. His critical insight was that if a family owns a company and they cannot agree about something, they ought to be concerned, and possibly ask someone else to mediate.
Ya think?
But Paul Solman had it right--this is not about petulant family members or employees taking sides in a personal kerfuffle--it's about what ownership of a company which is traded on a public exchange means. It's about whether a board of directors can raid the corporate bank account for their own enrichment with impunity.
This time, it looks like the good guys won.
But if this is an Aesop's fable, let's hope the right moral gets drawn.
Mad Dog