LOL, I guess you forgot to read anything else in this thread.
Let me run it by you again.
1. Board looks for a CEO. The board consists of usually a couple insiders and then some friends of those insiders to make them look like outsiders. Usually these people sit on multiple boards and often do business with eachother (interlocking).
2. Once a CEO is found, the compensation comittee sets the compensation structure. This is interesting, since the CEO, who is also usually chairman, sits on compensation comittees for other boards. Sometimes CEOs sit on multiple boards, thus, a friend network is established.
3. The board is supposed to represent the investors, not eachother. They are usually not huge holders of company stock. The largest holders of company stock are institutional investors. Pension funds, 401k, mutual funds...etc. The holders of the stock, the portfolio managers, have a fiduciary duty to vote the proxy of a share, since pension funds can't distinguish between shareholders, they are an undivided entity (Unless you specifically buy a certain stock, which even then is proxy voted).
4. Fund managers and analysts, ironically, sometimes sit on boards. Even if they don't, they often curry favor of those boards because the "other side of the house" or the investment-bankers want business. So therefore, the proxy votes are usually blank-checks to the board, the board then entices the C-levels to give business to the fund managers who have i-banking sides. Therefore, a vote is bought.
5. Once a CEO is entrenched and he has built up his buddy network, it's pretty damn hard to get rid of him. Look at Lay, Koslowski, the Rigas', Fiorina, Welch, Eisner (and the other dude...cant think of name right now), Silverman, or any other CEO of a mediocre performing company (or a fraudulent one). They were kept around not because of their prowess, but because of their buddies.
What I find hilarious is the fact that I *DO* know the system, yet people like you merely think that the magical number for knowledge is 100k. I knew the system before I made 100k, I know it better now, after, but that doesn't mean I didn't know it before. It has more to do with education and the desire to seek that knowledge and then to realize that the game is stacked.
if you want to be a sucker and merely write it off as blind faith while being blissfully ignorant to the truth, then by all means, I cannot stop you. If you don't want to believe that it's stacked, then thats your problem, not mine. However, these people love nothing more than those they can (mis)lead to the "golden pot".
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