The CEO Paradox

The hierarchy of America’s corporate monarchies can engender anarchy.

The defining paradox of leading a company is the corrupting power of the position and the great weight of accountability, according to former IBM manager and American Management Association boss Thomas Horton. Expecting to achieve balance between those extremes is idealistic; determination to maintain constant vigilance is optimistic; merely acknowledging the existence of the paradox might be the most realistic.

A pessimistic forecast for the struggle? Chaos.

Current events focusing on CEOs seem turbulent, and are frequently featured in the news media. There’s the extravagant level of compensation — sometimes set by executives themselves, or people under their control — and the recent White House proposal to deny tax deductions to executive pay of more than $1 million a year. There’s the cult of personality that can arise around the likes of Donald Trump and Michael Eisner. And there’s the political maneuvering possible by savvy — and solvent — corporate kingpins such as Ross Perot and Lee Iacocca.

Horton defends the concept of a chief, a chair, a head of the table in the boardroom. But he criticizes the practice and performance that can result from yielding to temptation. An iron-fisted approach, for example, can damage a CEO’s standing with some of the several constituencies that hold him or her accountable: executive colleagues...

(The entire section is 402 words.)