Aubrey K. McClendon, the CEO of Chesapeake Energy (NYSE: CHK), was punished for transactions which allowed him to invest in every well the company drilled. The firm’s board did not care about the arrangement until the press and some investors began to criticize it. McClendon will lose his job as chairman and the board will look for a replacement.
McClendon will probably be gone entirely before that person is picked. The pressure on the board to fire McClendon altogether is relentless. The board was complicit in McClendon’s good fortune. That will not stop its members from doing what is necessary to salvage their reputations.
The easiest way to do that is to identify McClendon as a cancer which will affect Wall St.’s opinion of Chesapeake as long as he is there.
Douglas A. McIntyre
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