Throughout the American corporate and financial world, this is the month that counts. The time when all your struggles go down in the record book. The ultimate measure of your performance.
Welcome to December!
Based on the performance climaxing this month, your annual report will be written, the letter to shareholders begin to take shape, and your bonus, and perhaps future will be established.
Take a look at the investor relations page for any major corporation, and you'll see a parade of Annual Reports, and letters to shareholders. While they're actually written in January and February, the performance that they are recording is based on December.
And today, and for the rest of the month, the pressure is really on US Industry and Finance. We all know the issues: an unreliable and expensive supply chain. A labor market with few, but expensive candidates for jobs. Financial Markets threaten to go wonky at any moment.
And not the least of the growing list of uncertainties in the present state of the pandemic, and its concomitant political reaction: the ever-present threat of lockdown.
Put all these factors together, and you have a sea of uncertainty for anyone who ventures to take the helm of a major US Corporation. Chief Executives, after all, are put in place to provide one thing: performance. That's what the Board of Directors expects, and that's certainly what the shareholders expect.
Fail to deliver on that implied performance, and no matter who you are you can expect to hit the road. Even if you're the founder of the company. Just this week we saw Twitter's CEO and Founder, Jack Dorsey resign.
And as much as we'll pretend that all was amicable, the fact remains that Twitter's stock performance was just half the gain of the S&P 500. A sure sign that the exit is near, especially if you're in a high growth sector like social media.
And Dorsey is far from alone.
Through the end of October over 1,300 CEOs have stepped down. With 172 CEOs resigning just in the month of October, an all-time record.
Now a good number have resigned amid scandal. With the usual peccadilloes and misconducts leading the way. Interoffice affairs, tyrannical mistreatment of employees, drugs, and alcohol.
And a good number have resigned, just because they've reached that point in life when retirement beckons. They really do want to “spend time with their families.” Something, no doubt that they haven't done very much over the years.
But for many, I dare say the majority, it's December that makes most resign. December, the month when the tally is added up. The record was made. When that annual report will record, for all posterity, the CEO's performance. How well he or she was able to meet the challenge. To guide the organization through the year. To manage the demands of employees, shareholders, and the board.
It's a task that in 2021 can be incredibly overwhelming. And I fully appreciate why so many are simply handing back the Corporate Keys when the year ends.
December, it's the ultimate challenge.