Baltimore's corporate leadership structure has been visibly weakened by retirements, ousters and outside takeovers, and the city is particularly vulnerable to any private leadership vacuum.
The declining economy puts pressure on charitable giving and also forces the occupants of local executive suites to pay more attention to their business' basic knitting. This translates into an inward-focused corporate posture, which means less of an executive's time and attention are devoted to public-policy issues.
The city's business leaders got used to being told what to do under former Mayor William Donald Schaefer. Some of them still haven't gotten used to the decentralized, deliberative style of Mayor Kurt Schmoke. Others have gotten tired of what they feel is an overly arduous process of getting through (and getting through to) the mayor's principal advisers.
But, if fewer executives are seeking the mayor's ear today than five years ago, it's increasingly clear that factors beyond style and ideology are at work. And the dominant factor is that there simply aren't as many powerful executives. (Besides, Gov. Schaefer has continued to tie up many to work on his agenda.)
If you don't believe the past year has been a tough one for Baltimore companies, consider this telling statistic from one of the many gnomes who melt my fax machine with dour news these days:
The market value of the common stocks of Baltimore's major publicly traded companies has plunged nearly 40 percent in the 13 months through November (gnomes have peculiar fiscal years).
The market capitalization of these 17 companies was $8.2 billion on Nov. 30, down 38.5 percent from $13.3 billion on Oct. 31, 1989. Here's a list of these companies, their capitalizations at the end of November (in millions of dollars), and their percentage change during the 13-month period:
During this period, the Dow Jones index of 30 industrial stocks was off only 3.2 percent, the broader S&P 500 was off 5.6 percent, and even the more vulnerable world of smaller companies, as represented by the index for NASDAQ issues, was off only 21.2 percent.
Clearly, companies here have been sailing through relatively turbulent waters, and these seas began running heavy a few years ago. Here's a list of some of the city's most significant companies and what's happened to them and their top leadership in the past few years.
Alex. Brown Inc. F. Barton Harvey Jr. retires; succeeded as chairman by Benjamin H. Griswold IV. Losing money this year; recently announced layoffs.
Arundel Corp. Sold to Florida Rock Industries.
Baltimore Federal Financial. The city's largest S&L was taken over by federal regulators and effectively liquidated; some offices were bought by Household Bank.
Baltimore Gas & Electric. Bernard Trueschler retires; succeeded George V. McGowan. Posting declining earnings; still suffering from problems at Calvert Cliffs nuclear plant; engaged in first general rate increase in several years.
Baltimore Sun. Sold to Times Mirror in 1986. Reg Murphy is succeeded in 1990 as publisher by Michael J. Davies. Soft business conditions; operation of new printing plant at Port Covington deferred until late 1991.
Easco. Taken over and absorbed into Danaher Corp.
Equitable Bank. Merged into MNC Financial.
First Maryland Bancorp. Sold to Allied Irish Banks.
Maryland Cup. Sold to Fort Howard Paper; sold again to Sweetheart Holdings Inc.
MNC Financial. Alan Hoblitzell takes early retirement; succeeded Alfred Lerner. Recorded huge losses due to soured real estate loans; seeking capital infusion via sale of successful credit-card operations; further layoffs planned.
Monumental Corp. Sold to Aegon, a Dutch insurance company. Leslie Disharoon retires.
Noxell Corp. Sold to Procter & Gamble.
PHH Corp. Jerome W. Geckle retires; succeeded by Robert D. Kunisch.
Union Trust Bank. Sold to Signet. J. Stephenson Peck retires.
USF&G. Jack Moseley takes early retirement; succeeded as chairman by Norman P. Blake Jr. Large losses reported; dividend cut; layoffs planned.
Baltimore has had its corporate successes, too:
Legg Mason has developed into a major regional brokerage company with stable company leadership that has been involved in civic affairs.
The Rouse Co., although based in Columbia, is the class of Baltimore's retailing efforts, and continues to be a solidifying player in supporting the city. Chairman Matt DeVito now heads the Greater Baltimore Committee, although he must spend more time on company matters following the tragic small-plane crash earlier this year that killed company President Michael Spear.
McCormick & Co. did cancel plans to move its headquarters back into the city and sold its flagship downtown site to the Rouse Co. But it continues to prosper, shows some signs of having a recession-proof business (as people tighten their budgets, they prepare more foods at home and, you guessed it, use more spice products) and contributed $2 million to Baltimore's literacy efforts.