The people who made the stupid decisions were rewarded pretty well. Weideking still sits on a few hundred million euros. This seems to be the new "free market".
Why is are these debates run only on terms of envy and retribution? The company made a bad decision, and they were absolutely not rewarded, they lost big. Weideking was hugely influential, but his contract with the company was already agreed at that point. You could say it was reward for his negotiating skills and existing reputation. Misaligned incentives is the fault of the company who, as we said, suffered for it. If the next guy to hire him makes the same mistake, maybe they will lose too.
The company authorised Weideking to take the ultimately unsuccessful strategy of turning Porsche primarily into a stock trading fund investing in VW shares, yes, and paid off his contract as agreed when it failed and brought the company to its knees.
The problem is that oversight and accountability is too weak. As CEO he was authorised to take actions which should've set alarm bells ringing with others, without apparent limit, and his contract (much like many others; Fred Goodwin would be a prime UK example) was poorly drafted so as to provide him with limited personal accountability for failure. UBS 'rogue trader' Kweku Adoboli is currently in custody awaiting trial for inflicting a serious loss on his company; Wendling Weideking was paid off handsomely for far worse. Boards need to take their role of executive oversight more seriously.
And like his contract, oversight and accountability is the responsibility of the board/shareholders/owners. Not any of us. He didnt "get away with it". It is nothing like rogue trading whatsoever, let alone "far worse". One is ill-advised but sanctioned, one is unsanctioned (well, that's another argument) and illegal.
This has nothing to do with envy and retribution. It's about an economic system that pretends to be a free market but is increasingly skewed to giving a certain class of people guaranteed rewards no matter how they perform. Not a healthy thing for an economy.
It is not a question of economic system. I don't even know what that means. His employer signed a contract saying if he messed up he still gets paid, AND failed to be sufficiently critical of his risk taking. As a result, they suffered. The only thing it has to do with the economic system is the existence of private contracts. I may disagree with their hiring policy, but it's none of my business. Would you feel any better if the golden parachute was simply paid on top of his salary?
