Eastern Railroad Discussion > OPED NS didn't need Bill Ackman

https://www.bloomberg.com/gadfly/articles/2016-10-26/norfolk-southern-didn-t-need-bill-ackman-and-canadian-pacific

The underlying question is whether NS would have made the tightening up choices without a sharp jolt to its comfortable habits.  Look seriously at the viability of some lines, determine where it should be investing, etc.

The same question can be raised about Canadian Pacific pre-Ackman.  Would Fred Green and his buddies have pushed the company for increased profits and a top to bottom shake up?  (The answer is usually answered by whether you held a few thousand shares of CP stock, or whether you were among the thousands who were forced to work a lot harder.)  Or would Fred have continued with his cushy club memberships, consulting deals for board members, and business as usual?

Well, it's not my job to defend Fred Green or Jim Squires or any other CEO, but my philosophy has always been  that if you don't like the management of a company, don't buy their stock.  I have no use for activist investors. 

Nothing mysterious about Ackman and Harrison.

Cut everything to the bone-run the hell out of everything, run one 12000 ft train  instead of three and before the system self destructs jump ship.
You don't need a Harvard business degree to hatch that plan.
 

Mike Bannon
St Catharines, ON

junctiontower Wrote:
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> Well, it's not my job to defend Fred Green or Jim
> Squires or any other CEO, but my philosophy has
> always been  that if you don't like the
> management of a company, don't buy their stock. 
> I have no use for activist investors. 

That's a great philosophy, and I hope it works well for your investments.

My philosophy is that share holders own the company, and management works for them. If management can't get the job done, the owners, through their elected board, should fire 'em.

The problem is that many shares are owned by pension funds, by Vanguard and Fidelity, by the provincial and state pension plans, and they're all in bed with management. Cushy clubs, fat consulting contracts, campaign contributions, etc. Employees and share holders get scr%$#@.

(I've mentioned elsewhere that I believe employees should own 20% or 25% of their company. Own the stock and have seats on the board. When YOU CAN FIRE MANAGEMENT, there's a lot more respect in the conversation.  I've mentioned it elsewhere.

Why should employees give up / be forced to give up contractual rights so management and owners can reap the savings in the future?  Makes no sense to me...)

I think it's arrogant that people think that just because they can afford to buy a chunk of stock, they think they know more about how to run the company than the people that have been doing it for years.  Some of them probably do, but most DON'T.