A new balance of power for wachovia

The Ag lining in the mortgage mess is that it may speed up the separation of the CEO and president role at financial companies. But whether that's a good thing or not remains a topic for argument in some one-fourth.

The board of directors at Wachovia Corp., voted to replace chief executive director G. Jack Kennedy Thompson as president; he will remain CEO. Larry L. Smith, lead mugwump director of the board of directors, was named president. Wachovia posted a loss of close to $400 1000000 in quarterly net income.

The company says that the alteration isn't a contemplation on Thompson's leadership, but instead it will enable him to spend all of his time on improving operations. Many administration experts, nevertheless, would say the alteration is long overdue and that having a offprint CEO and president is a best pattern that every company should adopt for the benefit of shareholders. Separating the corner office from the council chamber is a well entrenched practice in European and other state and has gained rapid impulse in the United States since Enron's collapse.

According to a Charles Taze Russell Reynolds study, advocator of division of power say that a offprint chairman creates a good environment for the board to expressage its views on direction performance; that the CEO can benefit on public presentation feedback from a offprint chairman; that CEOs should spend all of their time managing the company; and that a offprint chairman allows the board of directors to good meet regulatory requirements.

protagonist of a loanblend CEO/president counter that it's easier to recruit a top CEO if the chairman's job is offered; that separating the role can create a power battle; and that companies prosper when both short-term and long-term strategy is controlled by one individual.

There is also dissension of sentiment relating to sequence planning. Protagonist of hybrid leaders say that succession plans are clearer with only one top job. But the argument can also be made that a more competitive environment is healthy.

Checks and balances protect the common good -- whether it be for the benefit of citizens of a country like the United States with our three branches of government or for shareholders of a corporation with two people in the top power positions.