How will this year be different for the chief executives of American corporations? To begin with, in 2010 the corner office will see a lot more visitors as the CEOs of public companies adjust to increased scrutiny from board members and, in some cases, the government. As chiefs settle into the new year, they’ll of course face the age-old tension between short-term results and long-term shareholder value, but many will do so with restructured compensation packages altering their incentives. Others will face pressure to establish succession strategies that can actually work.
Public companies are entering a new era of government intervention, and many CEOs will start to view regulators as yet another constituency they have to serve. The level of government intervention and scrutiny will depend on the industry they’re in; the financial services sector will take center stage. “The Sarbanes-Oxley Act of 2002 introduced one level of scrutiny, but today we have the potential for a much higher level of intervention,” says Stephen Miles, vice chairman and head of leadership advisory services at the executive search firm Heidrick & Struggles. Miles says CEOs are focusing more on building relationships in Washington, hiring former regulators and working more with outside lobbying groups.