Nassim Nicholas Taleb on CEO incentives.
At some point, I’m going to get around to writing up my thoughts on The Black Swan and Fooled By Randomness. For now, here’s a choice quote from an absorbing August 2008 Portfolio interview with their author, Nassim Nicholas Taleb:
Lloyd Grove of Portfolio: Are the people who are running our financial institutions capable of learning from their mistakes and fixing them?
Taleb: No, and this is the problem with incentives. A C.E.O.’s incentive is not to learn, because he’s not paid on real value. He’s paid on cosmetic value. So he’s paid to be nice to the Merrill Lynch analysts or the Wall Street analysts. So this is where the problem starts.
BONUS: Bryan Appleyard’s excellent June 2008 feature on Taleb from The Sunday Times:
~
Category: Executives, The business brainIf you liked this post, please consider subscribing to the RSS feed so you can receive future articles delivered to your feed reader.
2 Comments so far
Leave A Comment
[...] UPDATE, a little later on Monday: I forgot this tidbit from February Nassim Nicholas Taleb on CEO incentives. [...]
That was a very interesting article about Nicholas, I have book marked that link so that I can go back and read it again, thanks for an interesting site.