Recognize that decision-makers must have access to the information necessary to make decisions and must be trustworthy enough to handle that information safely. That doesn’t mean that all people must have access and be trustworthy. It is possible to have subcommittees who have access to sensitive information and make recommendations to the board that are substantiated with enough information to make good judgments, but without disclosing the highly sensitive particulars.
Remember that in an idea-meritocracy a single CEO is not as good as a great group of leaders. Dependence on one person produces too much key-man risk, limits the range of expertise (because nobody is good at everything), and fails to establish adequate checks and balances. It also creates a burden because there’s generally too much to do. That’s why we have a co-CEO model at Bridgewater that is essentially a partnership of two or three people who lead the firm. At Bridgewater the CEOs are overseen by a board largely via the executive chairman or chairmen. In our idea-meritocracy, the CEOs are also held accountable by the employees of the company, even though these employees are subordinate to the CEOs. The challenge of having two or three people is for them to dance well together. If they can’t do that, and coordinate well with the chairmen, they have to notify the executive chairman or chairmen so changes can be made. For the same reason we have more than one CEO overseeing management of the company, we have more than one chief investment officer (there are currently three).
No governance system of principles, rules, and checks and balances can substitute for a great partnership. All these principles, rules, and checks and balances won’t be worth much if you don’t have capable people in positions of power who instinctually want to operate for the good of the community based on the agreed-upon principles. A company’s leaders must have wisdom, competence, and the ability to have close, cooperative, and effective working relationships characterized by both thoughtful disagreement and commitment to following through with whatever the idea-meritocratic process decides. We work with others to get three things: Leverage to accomplish our chosen missions in bigger and better ways than we could alone. Quality relationships that together make for a great community. Money that allows us to buy what we need and want for ourselves and others.