There is another victim of the credit crunch: the publicly traded model of ownership. The near-collapse of many of the large banks in perhaps a dozen countries shows that such corporate structures do not work.
I have served on the boards of various public companies for more than 20 years and most such constructs were dysfunctional. Interests were not aligned and there was more focus on pointless, ritual corporate activity than underlying profitability and productivity. Everyone tries hard, but the disconnect between management and ultimate ownership leads to the profound issues our economy now faces.
Large public companies are mostly owned by a hugely fragmented shareholder base. Most of us have pension and insurance policies, through which we all invest in equities; everyone owns them and yet no one does. No owner has control, so the hired hands rule the roost. Fund managers meet executive directors twice a year for an hour and expect to understand what is going on. Too often they judge management based on their ability to carry off a presentation rather than their true skills as leaders. Professional investors have stakes in 100 companies or more and expect to have real insight into all of them: a fantasy. Meanwhile, the top directors of a large public company can spend a fifth of their time visiting hundreds of actual or would-be shareholders.
PS. There's a letter in response to this piece from the chair of the FRC in today's FT, but I can't link to it for some reason.