Corporate executives are supposedly responsible to the owners (stockholders), via the board of directors.
If the executives have done a poor job, in the past, the owners (stockholders) would toss out the bad executives and get somebody else to run the place. Now, stocks are predominantly owned by institutional investors; if the executives fail to produce profits, the owners don’t intervene to fix the problem – they just sell the stock.
If the boards were doing their job, executives responsible for causing the company to lose large amounts of money SHOULD be ousted, instead of letting them gut the company and juggle the books to make the company’s short-term results appear better than they actually are. Now, it seems that the only sure way to get rid of a bad executive team is to let the companies go down the tubes entirely. Too bad the grabbermint is so eager to subvert that process by bailing out failed companies.
