| WorldCom or RudyCom |
December 2002
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CEO Superstars
As World Com tries to get back on its feet, the hunt for a new CEO has illustrated a sad and unfortunate trend in American corporate governance. Plausible names like Rudy Giuliani (New York's ex-mayor) have been joined with very unlikely ones, including actors and actresses. And why? Because Wall Street believes in that star power will translate into star quality stock performance. It just ain't so.
Rudy Giuliani was a divisive and autocratic mayor of New York who became a hero when the World Trade Center was destroyed and he survived. His management of the city pitted groups against one another, and especially the police against ethnic minorities. Yet, he is a plausible candidate because of his squeaky clean ethics -- this is the man who had Wall Street crooks handcuffed and paraded in what is called a "perp walk" -- that is, marching the accused before the press upon arrest. He could, possibly, restore some faith that WorldCom is on the straight and narrow.
Other people, such as movie stars, have no business running a business. Excelling on-screen, or elsewhere outside the boardroom, brings special effects to business but not the real thing, not profits.
Hollywood might function on the "star system," but business is about real production, real trading, real revenues. Once Wall Street figures this out, maybe WorldCom will be led by someone who knows something about making money out of communications.