Here's What Carl Icahn Thinks About Corporate America | Exploring Markets

Here's What Carl Icahn Thinks About Corporate America

Carl Icahn once sat down with famed Yale Professor and economist Robert Shiller.

He was invited to talk with his students about the stock market, corporate America, and management. But instead he spent 42 minutes talking about all the things wrong with companies today. What follows is what he told every student in Shiller's class. The entire video is at the bottom:
“It's Anti-Darwinian in America’s corporations. Let me give you an example: 
A guy goes to college, and this is the guy who becomes CEO, and he is in college and he is the kind of guy who was the president of the Fraternity. These are the guys I remember who are always at the Fraternity. He is always there even when you have a bad day. Let's say your girlfriend left you, or you got a bad test score, or whatever. He’s always there at the Fraternity. He buys you a drink, sits around with you, and he commiserates with you. Maybe you guys play a little pool. As a result, you like the guy. You can't help but like the guy. You even wonder when did he do any of his school work. But, he was always there for you despite that. He never made many waves. He never said anything too obtrusive. But, he was a just good guy who was friends with everyone. 
That same guy goes out into corporate America, and politically he's very astute. He knows how to get along with people and he never really rocks the boat. He never comes up with any great idea, and he’s not a threat to his superior. As a result, he moves up the ladder. And that's because, really, in corporate America, there’s really very little accountability. So, he moves along the ladder and he gets slowly up to the top. 
Now this guy has two attribute that got him here: he’s politically astute and he’s a survivor – he’s not really a threat and he gets to the top. These are the attributes of today’s CEOs. He doesn't ruffle feathers; he doesn't get the board upset; and as he moves up the ladder, he finally gets to be number two to the CEO. Now, the CEO has the same attributes – where he doesn't want to be threatened and he’s a survivor who is politically astute. The CEO will never let anybody be number two who’s smarter than he is. So, by definition, the assistant to the CEO is a little dumber than the CEO. And that cycle continues."