It’s a pity that while some companies like Otto Group realise the beauty of not going public, other companies like Lego, which is privately held and still majority-controlled by its founder’s heirs, decide to follow the money trail with greater fervour than ever.
As reported in “Rebuilding Lego” (FORTUNE, June 12, 2006), Lego’s new CEO Jørgen Vig Knudstorp has done more than cut jobs (1,000 in its Billund headquarters alone) and outsource manufacturing to cheaper locales like the Czech Republic. He has even upended Lego’s corporate culture, replacing “nurturing the child” as the top priority in Lego’s employee mission statement with “I am here to make money for the company.”
Well, I suppose if “the boss who assumes that workers’ interests are purely mercenary will end up with a group of mercenaries” (What’s That Spell? Teamwork!, FORTUNE, June 12, 2006), the same holds true for a boss who demands that his workers’ interests should be purely mercenary.
In the same issue of FORTUNE magazine, Geoffrey Colvin wrote an interesting piece on CEO greed, which cited a study by Erik Lie (unfortunate but real name) of 5,977 stock option grants between 1992 and 2002, in an attempt to highlight the problem of executives scamming shareholders by backdating options.
Colvin even went as far as saying that “the best way to control them [i.e. CEOs] is to make them tell their owners what they’re doing – and then make that information available widely, immediately, and freely”.
Transpose this statement to the situation in Singapore and one could probably say that the best way to control the CEO (i.e. the Prime Minister) is to make him tell his owners (i.e. the citizens) what he’s doing – and then make that information available widely, immediately, and freely.
P.S. Pardon the weak pun in the post title; it’s late at night and I’m still suffering from the effects of a bad sore throat.
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Just as a “notta lotta people know this” aside, but Lego is pronounced quite differently in Danish. It comes from the Danish word “lege” which means to play, and is pronounced something like “li-oh”.