Odd Idea

Here’s an odd thought I had in a meeting today….

I think professional CEOs should gang up into groups of 5-10 and share their income and long term incentives.

This would give them portfolio protection of their income and upside.

Also it would create a ‘personal board’ for each CEO in a partnership model which would ensure they perform to their peak.

Indeed such a system would lower the risk to investors in these companies safe in the knowledge that the CEO partnership would moderate bad behaviour and enhance performance.

Indeed they could eject a poorly performing member and be responsible for replacement.

They could even create greenfield groups with an initial investment by the members into a fund for co-investment into the companies they pick.

I suspect that such a model would align CEOs more closely with the risk-return profile of professional investors such as VC and PE.