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Old 10th Jan 2015, 18:47
  #32 (permalink)  
Sunfish
 
Join Date: Aug 2004
Location: moon
Posts: 3,564
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PLovett:

The primary reason for the board's existence is to provide oversight and policy direction to the CEO.
No.

The only reason for a Boards existence is to protect the assets of the shareholders.

They do this by operating a system of corporate Governance which basically boils down to risk management. That will of necessity involve questioning the CEO as to how he plans to manage risks that are within his control. The Boards ultimate job is to hire and fire the CEO and that depends on whether his continued presence is seen as a risk commensurate with expected return or not.

In my opinion as a former and very minor CEO, the problem with the current Board not containing experienced airline professionals is that there is no one who can question, let alone assess, the technical airline risks associated with the corporate strategy. They rely totally on management and suppliers like Airbus, Boeing, Rolls Royce, GE, etc. for that, and that is the source of your technical troubles vis a vis A380 vs. B777, etc.

To put that another way; the Board thinks that technical risks associated with running an airline are minor second order issues compared with the risk of damage to the Qantas brand - hence the focus on marketing and PR and the lack of focus on engineering and operations.

In my opinion this problem - the lack of any serious technical and operational experience in senior management is very common across a lot of industries, all you need today is an MBA.....
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