Corporate Leadership vs. Corporate Lordship

In November 2004, Richard M. Scrushy, founder of HealthSouth, a chain of hospitals and clinics, was indicted on 84 counts of fraud. Fifteen former HealthSouth employees, including five former chief financial officers have already pleaded guilty in the case. Other corporations that suffered at the hands of senior executives include WorldCom, Computer Associates, Enron, and Parmalat, the major Italian food and dairy company that recently collapsed.

One suspects that unlike Washington's officers, neither shareowners or employees were driven to tears when the corporate lords of these companies headed out the door.

But true corporate leadership still exists. Warren Buffet, CEO of Berkshire Hathaway and one of the richest people in the world was so troubled by his organizations purchase of a corporate jet that he christened it INDEFENSIBLE. Mr. Buffett's concern for Berkshire Hathaway's corporate image is a far cry from the image concerns of Ross Johnson, the former CEO of RJR Nabisco, who oversaw a fleet of ten corporate jets flown by the company's 36 pilots operating out of a lavishly equipped 27,000 square foot aviation facility at Atlanta's Charlie Brown Airport. RJR Nabisco was acquired by the investment firm of Kohlberg, Kravis, and Roberts (KKR)in 1988 following a failed leveraged buyout attempt led by Ross Johnson.

I was fortunate in reporting to a senior corporate executive who possessed the traits of a corporate leader rather than a corporate lord. While serving as the president and CEO of Great Northern Nekoosa Corporation, ultimately a $4 billion corporation employing 20,000 people, Mr. Robert Hellendale always put the interests of the company's shareowner's before his own personal financial interests. Others in the company followed his lead and worked diligently to conserve corporate assets and grow the company for the long-term benefit of shareowners. In response to one stock analyst's query into the company's five-year plan, Mr. Hellendale answered, "No oriental rugs!" Noting the confusion on the analyst's face, I explained to him that Mr. Hellendale was trying to get across a message indicating that the company would not waste assets on corporate trappings of wealth. L. Dennis Koslowski and other Tyco executive could have learned a valuable lesson from Mr. Hellendale.

Like General Washington, Mr. Hellendale understood leadership. Along with King George III, Mr. Koslowski, and others like him, only understood lordship.

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