Sometimes you might find yourself completely out of your element and there is no escape. All you can do to get through it is to learn as fast as you can and keep quiet until you get up to speed.

Last week, I got to spend some time at the Aspen Institute <http://en.wikipedia.org/wiki/Aspen_Institute> and participate in a program dedicated to re-envisioning financial design. It was my first time at the Institute, and I highly recommend the experience to everybody who has the opportunity to do so. The grounds and architecture alone are reason enough to be there and the surroundings seem to propel your thinking forward and beyond your old comfort zones.

A group of about 15 people who represented professionals from varied backgrounds that included oil company CEOs, venture capitalists, economists, senior global bank executives, experts in corporate law, and one designer/ad goob. That would be me. Two days of immersive and structured conversation began with people subtly defending their positions and their roles in the financial system and corporate structure which we all share. But the Aspen Institute quickly worked its magic and soon we were finding that no matter our place in the system we all had very similar concerns, and the differences we had were differences of perspective. Not differences of opinion. This was an incredible experience to be a part of and it was transformative. Pessimists became optimists and skeptics became visionaries. I came away with a hefty to-do list. Both for myself and for the businesses I’m close to, and for what can be done to redesign some of what is not working in public companies.

The first surprise/debate/epiphany for the group was around current corporate law. In a 2007 article in the Journal of Business Ethics, 31 of 34 directors surveyed (each of whom served on an average of six Fortune 200 boards) said they would cut down a mature forest or release a dangerous, unregulated toxin into the environment in order to increase profits. Whatever they could legally do to maximize shareholder wealth, they believed it was their duty to do.

Now this is certainly extreme and many involved in our discussion believed that directors have a much clearer sense of the law, but my sense is, and the research seems to support this, that much of senior management and many directors do believe in shareholder primacy. That their number one duty is to maximize shareholder returns and short term returns at that.

The surprise to me is that this widely held corporate view just is not true from a legal sense. And the legal opinion in the room was of the sort that advises Congress. Not just some average corporate lawyers.

“Shareholders do not own the corporation, which is an autonomous legal person. What’s more, when directors go against shareholder wishes—even when a loss in value can be documented—courts side with directors the vast majority of the time. Bottom line. Directors and management are under no obligation to manage for the short term and have every right and power to manage for the long term.”

This is important news at a time when short-term thinking is hurting our companies and our ability to make necessary changes for what is proving to be a very challenging future. And this short term stockholder rights thinking has to be corrected at many levels. Certainly at the director level and with C-level executives, but because of the incentive structure of bonuses linked to stock prices, it needs to be corrected throughout every organization.

As I think about this problem as a designer, it seems to me you wouldn’t want to set about redesigning something if you didn’t have an accurate sense of the current design. And so this may be the first important step of this redesign. I’d like to see a few celebrity CEOs pick up this banner and create a presentation - not unlike what Al Gore did with Global Warming and begin to correct this very basic misunderstanding. Something fun with lots of data on just how confused we are. Richard Branson at TED could open up with this, “31 of 34 directors (90 percent) believe that it is their duty to do whatever they can to maximize shareholder wealth. Even if it isn’t the best thing for employees, the community or the environment.” Then he could just look out at the crowd for a bit of dramatic effect before going on, “Guess what? They’re wrong.”

I’d be thrilled to work on this project if anybody knows a celebrity CEO who wants to get involved.

Once we have our new foundation of understanding I think we can set out on doing some more designing. There is a lot that can be done on both the micro (individual company) level and the macro (market) level. On the macro side of the design I think that Bill B. framed it best when he spoke of sports and gambling. We all accept that it’s a bad idea to allow the players/coaches/owners of college and professional sports leagues to gamble. The reason is obvious: it will invariably lead to corruption/abuses/unfair practices. And it has. The White Sox became so tainted in a 1919 gambling scandal that they became known as the Black Sox and the entire team was banned for life. So the institution of sport must remain above suspicion if it is to survive.

Yet in our most important of institutions, our economy, we have allowed short term traders and speculators to gamble with our collective futures in their own desire to get rich without contributing anything to the society. The abuses have been severe and they continue. These institutions and this high velocity money isn’t really investing in these companies. It isn’t parked there long enough for the company to even know it was bought and sold. This money isn’t investing in America. Investing isn’t the word at all. Gambling is the word. Speculating if you want to be kind. The company CEO who experiences the ups and downs of their stock price on the whims and manipulation of this kind of fast-moving capital gains nothing. The company and the CEO want true “investors.” People and institutions that are buying into the plan that management has to move the company forward. This kind of longer term investment is good for companies, good for the stability of markets and good for America. We need more of it. And when I say “longer-term” I’m actually just talking about time periods of more than a day. That’s how short term we’ve become.

Taxing these high velocity traders a fraction of a cent per trade might be a design change worth considering. As well as changing the voting rights for stock so that voting rights required a stockholder to be an owner for a certain period of time. Right now if you own it for 30 seconds or ten years you have the same rights as a stockholder. Perhaps more of a meritocracy is required. And today we have the ability to make this a reality. The consensus of the group was that an investor with a more intimate understanding of the companies involved is a benefit to the company and the management and the economy as a whole. So where do we find more of these?

One option that was discussed is with a company’s own consumers. We are seeing companies and consumers entering into relationships that already make the customer a powerful stakeholder. Does it make sense for a company to work to migrate it’s most loyal and passionate customers into ownership? Although the stock volume that consumers represent is small, it can be a stabilizing force in several ways. First, the trend is already moving in this direction. Globally we will continue to see more private individuals investing in the stock market. And any force that offsets high volume speculators will be helpful for the companies and their management. Second, although per dollar the individual investor makes up less dollars by volume, their dollars and their investment comes attached to a soul and a brain that has the ability to have a voice in the market louder than money alone.

My dad is this kind of personally and emotionally vested individual investor. He finds companies he feels he can believe in for a long time and puts his money there. At times I’ve thought it silly and unsophisticated. And I admit I was still happy to see him diversify a bit. But his approach is right. In fact, his approach is the same approach Warren Buffett takes. Do your homework and get in for the long haul. Right now our markets, our CEOs and our country sure could use a few more Warren Buffett’s. And maybe a few million more Bill Boguskys.

FearLessRevolution.com