Would GREAT PEOPLE DECISIONS help avoid corporate scandals?
Fernández-Aráoz: Of course! The evidence is clear that corporate scandals have been the result of wrong people decisions at the top. These corporate scandals have cost thousands and thousands of jobs, the loss of the life savings of many people and, even worse, a dramatic decline in trust in business leaders, with extremely negative consequences for investment and growth. However, the current focus on recent outrageous (yet extremely rare) corporate scandals has obscured a much larger scandal that nobody mentions. This hidden scandal involves the multitude of cases where organizations not embroiled in any scandals whatsoever have made appointments to senior positions, which have led, in turn, to mediocre individual and corporate performance. The aggregate cost to society of this mediocrity is far higher than that of the few public scandals. Will GREAT PEOPLE DECISIONS help solve the current CEO compensation issues? Fernández-Aráoz: It will certainly help bring the debate under the righ
