There are two main reasons for giving employees stock options and one of them is precisely the idea of creating "skin in the game". The author provides examples of CEOs whose stock options amount to millions of dollars after they are fired. So the author complains that CEOs don't have skin in the game and demonstrates this by explaining how the skin they have in the game makes them extremely wealthy.
Sometimes, the incentives from "skin in the game" lead to perverse business decisions. Want to drive a stock price up? Fire 50% of the employees and show that your earnings per employee increased 75%. Nevermind that those numbers indicate that your earnings decreased dramatically. Your _profit_ increased substantially in the first six months after the layoffs. The value of the CEO's shares goes up, and the skin they have in the game makes them a lot of money. The stock doesn't correct as quickly as CEOs come and go. Even in the example of HP's big one-day jump after Fiorina left.
As for family run businesses, most of the the TV references were over my head. I haven't watched any of those shows. But I can offer an age-old story I am familiar with. It often goes by the name of "The Prodigal Son". It defies almost all of the author's reasoning.
Sometimes, the incentives from "skin in the game" lead to perverse business decisions. Want to drive a stock price up? Fire 50% of the employees and show that your earnings per employee increased 75%. Nevermind that those numbers indicate that your earnings decreased dramatically. Your _profit_ increased substantially in the first six months after the layoffs. The value of the CEO's shares goes up, and the skin they have in the game makes them a lot of money. The stock doesn't correct as quickly as CEOs come and go. Even in the example of HP's big one-day jump after Fiorina left.
As for family run businesses, most of the the TV references were over my head. I haven't watched any of those shows. But I can offer an age-old story I am familiar with. It often goes by the name of "The Prodigal Son". It defies almost all of the author's reasoning.