Why Some CEOs Don't Get It

Robert Nardelli, former CEO of Home Depot, is a case in point of a CEO who didn't understand the complexities required of running a company in A.E. (after Enron). Enron was a wake-up call to companies and to shareholders that the smartests guys in the room are not always the most ethical. Nardelli was quoted in the Wall Street Journal as saying that he just didn't understand why shareholders were upset with him. "I have always believed that if you make your numbers, everything else will fall into place". That didn't happen and Nardelli, confused over what was happening, fell from grace.But, the real story is what happened to Nardelli. He was fired by the board, but with a severance package of about $120 million. Guess that really showed him!! Why should a CEO really care when they can leave with such a hefty sum. They must be feeling such a sense of disgrace as they sit in their island homes sipping Margaritas and telling stories about all the jerks who didn't understand their value.

There certainly are a plethora of outstanding CEOs that do not think like Nardelli. If they are doing well by their employees, customers, shareholders and others, I hope they eventually retire with all the perqs and money owed them. I have always believed that Jack Welsh deserved his large retirement package. Look what he did for GE. But, it seems that there still are too many CEOs who are rewarded for screwing up. Hard to give a message to future CEOs who see gold at the end of the rainbow, regardless of the direction they decide to take.I'd like to see boards let CEOs like Nardelli go with the same severance package given to any other corporate officer. If they have really damaged the company's reputation and ruined the lives of employees, I would hope that the board would make an example of them and help them sit in a far less comfortable retirement thinking about what might have been had they understood their roles more fully.