Its fashionable to ask for the heads of CEOs when things go wrong. Can one person be solely responsible when things go really wrong? If a company is caught up by external factors beyond their control, like the current crisis, one may be able to argue that they cannot really plan for such contingencies. The crux is when the CEO is the architect of the very policies and strategies that caused their companies to be mostly responsible for their mess, when the bust comes, they do so spectacularly. Some of the CEOs here literally were the poster boys and emblems for many of the financial crisis. Here are the top ten worst CEOs ever by Portfolio.com:
THE STAT: Fuld was recently spotted trying to figure out the Jet Blue check-in machines at La Guardia Airport.
THE STAT: Mozilo’s once-secret, now-infamous “Friends of Angelo” program provided loans on favorable terms to politically influential borrowers, including Senators Kent Conrad and Chris Dodd.
THE STAT: Enron stock lost 99.7 percent of its value in 2001.
THE STAT: What a difference a year makes: A share price of $10 doesn’t sound too bad these days.
The ultimate corporate shopaholic, Ebbers bought an obscure telephone carrier in the 1980s and went on a 17-year acquisition binge that turned it into the world’s largest telecom company. Alas, his passion for dealmaking didn’t translate into the savvy necessary for running the complex business. When telecom stocks went south in 2000, the company’s massive debt was exposed. Ebbers tried to disguise it through fraudulent accounting. In 2005—three years after WorldCom filed for bankruptcy—he was convicted of overseeing $11 billion worth of accounting fraud. He’s now serving a 25-year prison term.
THE STAT: When Ebbers resigned, in 2002, WorldCom stock had fallen to $1.79 from a peak of $64.50 in 1999.
Normally, when an overhyped honcho falls from grace, time must be spent digging up his most egregious public statements, revealing the swagger that preceded the downfall. “Chainsaw Al” Dunlap, in contrast, was just getting revved up when his career conked out and his reputation got shredded. Picked by the board of Scott Paper Co. as the man to turn the struggling company around, Dunlap earned his nickname by slicing 11,000 employees. When Scott merged with Kimberly-Clark, Dunlap’s payoff was estimated at more than $100 million. Unable to flip Sunbeam to a new buyer, as he’d done with Scott, Dunlap was stuck actually running the company. He failed spectacularly. Within two miserable years, the board fired him. The tactics he’d used to stave off losses—the company overstated its net income by $60 million, which was real money back then—earned him a civil suit from the SEC and a class-action suit by shareholders. Dunlap eventually settled both and was barred from serving as an officer or director of any public company. You could call Chainsaw Al’s story a fall from grace, but in his case, that’s probably not the proper word.
THE STAT: Joseph has since become managing director of Morgan Joseph & Co. In 2007, an industry group named him investment banker of the year.
THE STAT: When Gould died, his fortune was worth an estimated $67 billion in inflation-adjusted dollars.
THE STAT: Today, NCR is worth $1.5 billion.
While the rest of the world was moving toward personal computing, Akers remained stuck in the mainframe age, never quite figuring out what to do with IBM at a critical point in the tech industry’s evolution. Many outsiders viewed Akers as being in over his head. IBM was paralyzed by his lack of decisiveness.
THE STAT: Akers stepped down shortly after the company announced a $4.97 billion net loss for 1992.
p/s photo: Charlie Yeung & Gigi Leung