Suppose that a company’s board is seeking a new CEO. After an agonisingly long search, its members decide to go with a newcomer to the industry, claiming that the candidate will make the firm the market leader again. And, indeed, the new CEO shows up with big plans, spending the first six months dismantling and castigating past policies and practices, sometimes without rhyme or reason.

The CEO hires “yes men”, perhaps old colleagues, friends, or even relatives. Possessing as little experience as the CEO and plenty of incentive to curry favour, they do not offer sound counsel. Even if they did, the CEO wouldn’t take their advice. Add to that a lack of transparency, together with apparent violations of business ethics and basic leadership principles, and the CEO’s credibility quickly wanes.