Every year, Santa and I get together at his place (that would be the North Pole), break out the nog and hash out a list of the naughtiest chief executives. They still get their outsized pay packages, but the fat man can’t resist filling their Christmas stockings with enormous lumps of coal. I don’t blame him one bit.
While Santa insists on keeping our methodology strictly on the down low, I can say that we focus exclusively on CEOs of publicly-traded companies based in North America. Unfortunately, that rules out Shigehisa Takada of Takata and Elizabeth Holmes of Theranos, both of whom have been very naughty this year.
Without further ado, here’s our Worst CEOs of 2016 list, counting down from …
No. 7: Nick Woodman, CEO, GoPro
With video all the rage and drones poised to take off, you’d think the market leader in action cameras would be going gangbusters. Instead, GoPro is crashing and burning. With its ill-conceived dreams of becoming a media company crushed, its much-hyped Karma drone recalled, and its bread and butter Hero under competitive pressure, revenues have collapsed and so has the stock, down 90% from its all-time high.
No. 6: James Park, CEO, Fitbit
It’s not as if Apple’s entrance into the smartwatch, health and fitness space was a closely guarded secret. The launch of Apple Watch and HealthKit were long anticipated by pretty much everyone … except apparently Park. Growth hit a brick wall and shares of Fitbit fell off a cliff, plummeting 75% from its post-IPO high. Acquiring Pebble’s software might have been a good move … two years sooner. The delayed response looks a lot like the sort of founder denial we saw at BlackBerry, post-iPhone launch.
No. 5: Eddie Lampert, CEO, Sears Holdings
Massive store closures, sales declines and losses. Investors flee the stock. That could have described 2013, 2014 or 2015 for Sears. Just when you thought things couldn’t get worse, they did: 2016 was more of the same, as shares plunged another 50%. With a market cap of just $1 billion, Sears and Kmart are now essentially worthless. And Lampert makes the list for an incredible fourth straight year.
No. 4: Jack Dorsey, CEO, Twitter
Twitter has not fared well as a public company, but it was doing better under former CEO Dick Costolo than part-timer Dorsey. So much for that founder magic you always hear about. Dorsey inherited a company that was going nowhere, and despite changes to the product, the business model and the team, it’s still going nowhere.
User growth stalled long ago, having been eclipsed by Instagram and Snapchat. Revenues have also flatlined, but not the stock, which is down 20% this year, 50% since Dorsey took over as interim chief and 66% since its 2015 high. It’s time for Twitter’s board to do its job and replace Dorsey with a full-time turnaround CEO (not Marissa Mayer).
No. 3: John Stumpf, former CEO, Wells Fargo
The headlines were overhyped, the political theatrics were over-the-top, the social media firestorm was overwrought and the man who was branded as the worst corporate villain since Jeff Skilling of Enron was nothing of the sort. All that notwithstanding, Stumpf did mess up bigtime. He simply had to go.
After firing 5,300 employees for creating 2 million fake customer accounts over a five-year period, Stumpf demonstrated a stunning lack of judgment by sweeping it under the rug and continuing to push an overly aggressive sales goal. Getting grilled on Capitol Hill couldn’t have been easy, but that wasn’t the time to do an impression of a weasel.
The whole ordeal goes down as a string of unforced errors that damaged a stellar career and a great brand.
No. 2: Heather Bresch, CEO, Mylan
While Bresch deserves credit for single-handedly turning EpiPen into the first real blockbuster in the generic pharmaceutical company’s 55-year history, her masterful exploitation of the bureaucratic mess known as the American healthcare system wasn’t quite so honorable.
Pushing legislation to create demand and suppress competition, Bresch effectively created a $1 billion monopoly for Mylan’s epinephrine injector, then raised wholesale prices 500% over a seven-year period. Naughty, naughty, Heather. Shares of Mylan are down 30%, year-to-date, and trading near a three-year low.
No. 1: Michael Pearson, former CEO, Valeant Pharmaceuticals
If you took the accounting of Enron, the M&A strategy of WorldCom, the ethics of Gordon Gekko and turned it into a pharmaceutical company, you’d have Valeant. Since taking over as CEO in 2008, Pearson’s strategy has apparently been one of leveraging debt, acquiring drug companies, firing the scientists and jacking up prices.
The scheme began to unravel as Valeant’s predatory pricing practices were publicly targeted by Bernie Sanders and Hillary Clinton in the run-up to the democratic presidential primary. The stock has since lost 95% of its value, costing investors $85 billion over 18 months. Pearson stepped down in April but it’ll always be his mess.