Bill Ford Jr.'s actions show the firm's reputation comes first
By Daniel Howes / The Detroit News
DEARBORN--You can bet that Bill Ford Jr.'s decision to dump his 400,000 shares in Goldman Sachs Inc. and donate the profits of roughly $4.7 million to charity won't satisfy lawyers always looking for someone to slap in exchange for another fee.
But it should put to rest any snarky skepticism about whether the chairman of Ford Motor Co. -- who, by the way, hasn't received a dollar of salary since becoming CEO in the fall of 2001 -- has the character to do the right thing. If you need one more piece of evidence that Bill Ford isn't your garden-variety rich guy, this should be it.
No, Ford's directors didn't "make" him sell the shares because they feared keeping them would sully the automaker's reputation and besmirch their standing in Corporate America. Fact is, the incident didn't prompt the directors to alter their rules governing private business transactions between directors -- in this case Bill Ford and director John Thornton's Goldman Sachs.
No, Bill Ford didn't sell his initial public offering allocation in Goldman Sachs because he was "caught," which would imply he did something wrong. And by Ford's rules and general corporate governance practice he didn't, because as non-executive chairman he wasn't a Ford employee at the time of the transaction, and he didn't use Ford money to make the purchase.
Bill Ford is dumping his Goldman Sachs shares because his reputation and that of the company that bears his name are more important to him than a $4.7 million profit, which he will donate to one or more charities in southeastern Michigan.
Did I say he has not drawn a salary since succeeding Jacques A. Nasser as CEO in late October 2001, a trend that will continue this year? Consider, too, that the 4 million or so stock options he has so far received in lieu of salary are deep "underwater," as they say, meaning he could use them to paper the bathroom in a hunting lodge for all they're worth.
There aren't many corporate leaders anywhere in the United States who would sign away that kind of cash to end the questions and eliminate an apparent conflict of interest.
For that, Metro Detroit and Ford's employees should be immensely proud, considering that at the same time former Kmart Corp. executives are skulking around, dodging subpoenas and clinging to retention loans and severance payments they don't deserve.
The point is this: Bill Ford isn't much interested in using his position as Ford's CEO to enrich himself because he doesn't need to. It's more important to steer the world's No. 2 automaker away from danger and toward sustainable profitability, ensuring his and his family's wealth far more than any stake in Goldman Sachs.
Bill Ford's brush with corporate scandal is a brief footnote compared to the real scandals that have ruined lives, destroyed savings and trashed reputations. His Goldman Sachs affair is a telling reminder of how unrelated corporate implosions often greased with greed can be conflated into a "trend" that labels all corporate execs as greedy crooks.
They aren't. But when it comes time for investors to find someone to blame for their misfortune, it's easier to look to executive suites and utter "greed" than where the responsibility often lies -- in their own mirrors.
My first car was a 67 Mustang Coupe, 2nd one was a 67 Cougar XR-7, 3rd one was a 66 Mustang Coupe. Why did I get rid of these cars for ? I know why, because I'm stupid, stupid, stupid.
My next Ford.....