Comparing the kite and the red devil
Both are commercial entities. Responsibility is to the shareholders. Delivering the best value to them is the stated aim of any such entity.Now here's the difference which is glaringly in fron of us glaringly in front of us!
There has to be a motivator for the managers of the business to perform the best. There is two.
FIRST- The managers get good performance bonuses if they deliver the profit. Be it cash or share options and of course the sack if the delivery is a failure. The backlash should be severe enough, that he would not be able to find another job on the drivers seat for the rest of his life from any right thinking organization. This should be motiation enough for a manager to perform if not for the love of money, at least the scare of being reduced to an insect.
SECOND - The managers are the owners of the entity. I would have sleeepless nights if I had put my fortune where my mouth is. If the company turns turtle it is my money, my family's life and my life. I could never be a clock watcher, will be first on the scene in crisis, motivate my staff, learn every nuts and bolts of my operation and then I could speak with certainty of the path I am leading my organization.
Then why do organization still fail despite being managed by the largest shareholder. Well, when you are in the the driver's seat because you are the largest shareholder by owning a minority share you earn better by scheming the company's business into companies you fully control. Even though your minority shareholding company losses. you can legally carve off a bigger amount through your fully owned companies. Corporate governance (good luck to you if you invest by believing in it), enforcement, ownership of failure - who cares, I can go on because I am one of the little napoleans, .
Take a pick guys and gals. which kind is yours!