One of the many functions, shareholders have at the Annual General Meetings is to cast a vote for management and their salary structure. Although for most profitable companies, who is the CEO is not as important as we all make it all to be, as a shareholder you are concerned with who it is. For that reason we pay attention when there is a CEO change.
In an article by Kate Conger and Lauren Hirsch of The New New Times News Service, one of the high visible social media companies Twitter, its co-founder Jack Dorsey stepped down again. Mr. Dorsey was replaced by Parag Agrawal, the former chief technology officer.
Mr. Dorsey was a well known name in Washington circles, partly because he made the decision to shut down former President Trump’s twitter account after January 6. Some in the Republican party believe social media has tried to silence conservative view point.
Mr. Dorsey is a founder of payments company Square and he will be continue to be busy. When he left Twitter, he noted he worked hard to ensure the company could break away from being a founder led company. Also Twitter has not been a high flyer in the stock market and over the past year has gone up and down and back to where it started 2021. Twitter said its revenue grew by 37% in the 3rd quarter to 1.28 billion but it lost money $537 million.
Often times even though there is more than one player in a sector, either one company tends to lead or seems to lead or puts out more press releases or its CEO is available to talk to the press more than other companies. As long as the stock price goes up, people are happy, when the stock price does not, rumblings begin. For Mr. Dorsey he became a counter weight to the former President, on what should and should not be posted in Twitter. How much fact checking should a company do to the President of the country?
Linking to dividend paying stocks, for the most part even though as a shareholder you are interested in the CEO, it is hoped that the person could be changed and profits continued. While the person in the office is important, as long as the strategies to move the company along to stay profitable and pay dividends, the person might not be well known to the general public. When the person is known to the public, it is a double edge sword – sometimes good, sometimes not so good. The issue is whether when the person leaves the job, how does the market feel about it – it is good, bad or indifferent?
There are more questions than answers, till the next time – to raising questions.